Liz Claiborne is selling its retail chain in Canada to women's wear retailer Laura Canada, a privately held firm based in Montreal. 

The Canadian company says it intends to convert the 38 stores to its Laura or Melanie Lyne nameplates by October.

The acquisition, financial details of which were not disclosed, will help Laura Canada lift its total store count to 170 by the end of the year.

"As a result of the expansion we see a tremendous opportunity to penetrate the market further and offer our customers more convenience to enhance their shopping experience," explains president Kalman Fisher.

The new locations are in the six provinces of Ontario, Alberta, Quebec, British Columbia, Nova Scotia, and Manitoba.

The move is part of plans by Liz Claiborne Inc to stem declining sales in a challenging retail environment.

From this August the firm will only sell its flagship brand at department store retailer JC Penney in the US, after third quarter comps fell 13%.

The company is also paying the price for past strategies of aggressive expansion and acquisition, built on an unwieldy and high-cost sourcing and distribution model.

Even so, CEO Bill McComb told analysts in November that it could be another year before Liz Claiborne's eponymous brand returns to the black, thanks to the deal with JC Penney and new, Isaac Mizrahi-designed items.