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DETROIT - Kmart Corp. today announced it will close 284 under-performing stores in 40 states and Puerto Rico, and eliminate around 22,000 positions as part of its restructuring under Chapter 11 bankruptcy.
The stores to be closed include 271 Kmart discount stores and 12 Kmart Supercenter retail outlets in the United States, and 1 Kmart store in Puerto Rico. The company said these stores will remain open for business pending approval of the store-closing plan by the Bankruptcy Court for the Northern District of Illinois.
Kmart said it expects the closings to enhance its cash flow by approximately $550 million in 2002 and approximately $45 million annually thereafter. The company also announced that the closing of these stores will result in the reduction of approximately 22,000 associate positions.
"The decision to close these under-performing stores, which do not meet our financial requirements going forward, is an integral part of the company's reorganization effort," said CEO Charles C. Conaway. "We are confident that doing so will provide the company with a healthier, more productive store base. While the business rationale supporting this action is compelling, we deeply regret the impact these store closings will have on our associates, our customers and the communities where these stores are located."
Kmart said a list of the stores slated to be closed will be posted to www.bluelight.com under Kmart News later today.
Kmart Corporation has asked the Bankruptcy Court to give final approval to the store-closing plan at a hearing in Chicago on March 20, 2002. The plan includes the anticipated disposition of inventory in excess of $1 billion during store closing sales as part of the program.