Retailer Sears Holdings has received US$446.5m in gross proceeds from the completion of its spin-off of its Hometown and Outlet businesses.

The figure comprised $346.5m from an earlier rights offering and a $100m cash dividend from Sears Hometown.

As part of the transaction, which took place yesterday (11 October), Sears Hometown entered into an asset-based senior secured revolving credit facility with a group of financial institutions. This will provide maximum borrowings of $250m, which were used to fund the dividend to Sears Holdings.

Sears Holdings's board approved the separation of the company's Hometown and Outlet businesses in August.

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Sears Holdings Corporation Completes Separation Of Its Sears Hometown and Outlet Businesses; Receives $446.5 Million In Gross Proceeds

HOFFMAN ESTATES, Ill. Oct. 11, 2012 /PRNewswire/ -- Sears Holdings Corporation (NASDAQ: SHLD) today announced that its rights offering to effect the separation of Sears Hometown and Outlet Stores, Inc. ("Sears Hometown") from Sears Holdings closed on October 11, 2012 , as previously announced. Sears Hometown has now been separated from Sears Holdings and its common stock is expected to begin trading on the Nasdaq Capital Market under the symbol "SHOS" onOctober 12 , 2012.  Sears Holdings will continue to be listed on the Nasdaq Global Select Market under the symbol "SHLD."  Sears Holdings received aggregate gross proceeds from the separation transactions of $446.5 million , consisting of a cash dividend of $100 million paid by Sears Hometown prior to the separation and aggregate gross proceeds from the rights offering of $346.5 million .

As previously announced, the rights offering was fully subscribed, with over 95% of the outstanding shares of common stock of Sears Hometown being subscribed for pursuant to the exercise of basic subscription rights and the balance being subscribed for pursuant to the over-subscription privilege.  Accordingly, Sears Holdings distributed a total of 23,100,000 shares of Sears Hometown common stock to the holders of subscription rights who validly exercised their subscription rights and paid the subscription price in full.

In addition, as part of the separation transactions consummated today, Sears Hometown entered into an asset-based senior secured revolving credit facility with a group of financial institutions to provide (subject to availability under a borrowing base) for aggregate maximum borrowings of $250 million , borrowings under which were used to fund the dividend paid to Sears Holdings.

The shares of common stock of Sears Hometown were distributed by the subscription agent for the rights offering, by way of direct registration in book-entry form.  No physical share certificates were issued.

Registered holders of subscription rights who properly requested to purchase additional shares of Sears Hometown common stock pursuant to the over-subscription privilege received additional shares in an amount up to 5% of the shares received through their exercise of basic subscription rights. If you have questions about the number of shares of Sears Hometown common stock you received in the rights offering and you held and exercised your subscription rights in physical form as a registered holder, please contact Computershare Trust Company, N.A., the transfer agent for Sears Hometown, at 1-781-575-4379 or 1-888-679-2864 (toll free). If you held and exercised your subscription rights through a broker, dealer, custodian bank or other nominee, please contact your broker, dealer, custodian bank or other nominee.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy shares of Sears Hometown common stock, nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state.

 

 

 

Original source: http://www.prnewswire.com/news-releases/sears-holdings-corporation-completes-separation-of-its-sears-hometown-and-outlet-businesses-receives-4465-million-in-gross-proceeds-173738931.html