Home Depot will buy and convert up to 24 Kmart stores.
The deal is worth as much as $365 million, depending on how many stores Home Depot buys, and should be negotiated by mid-August, according to Kmart. The two are negotiating the number and location of stores as well as the price.
Home Depot is expected to convert the stores “as quickly as possible,” per Kmart.
The news fueled rumors that Sears, Roebuck & Co. may buy some Kmart stores for its fledgling Sears Grand brand of standalone stores.
Home Depot, Atlanta, has 1,552 stores in the U.S. Troy, MI-based Kmart has 1,504. Kmart closed about 600 stores while under Chapter 11 bankruptcy protection January 2002 through May 2003.
Kmart President-CEO Julian Day deflected speculation on the value of Kmart’s real estate and possible divestiture of the chain. “We’re taking action on many different fronts simultaneously, all with the goal of making Kmart a great retail company once again,” Day said in a statement. Over the last year, “we’ve improved several areas including product design, buying, inventory management, distribution and the in-store environment. By the same token, we will take advantage of opportunities to create value that include the sale of existing stores, or the acquisition of new stores and businesses.”
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