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Sears expects $346.5M in proceeds from offering

HOFFMAN ESTATES, Ill. -- Sears anticipates that it will receive about $346.5 million in gross proceeds from a rights offering related to the spinoff of its Hometown and Outlet stores.

Sears Holdings Corp. had signaled in February that it would split off the companies as a separate publicly traded entity.

The rights offering debuted on the Nasdaq under the "SHOSR" ticker symbol in September. Sears said Tuesday that the rights offering expired on Monday and that preliminary results show that there were subscriptions for more than 95 percent of Sears Hometown shares.

Sears anticipates distributing 23.1 million shares to subscription rights holders who validly exercised their rights and paid the subscription price in full.

Sears Hometown is expected to enter a senior secured revolving credit facility with borrowings of up to $250 million. Sears Hometown plans to draw $100 million under the facility to pay a cash dividend to Sears Holdings before it separates from the company. This will make up part of the part of the gross proceeds that Sears Holdings receives.

Sears, which also owns Kmart, has looked at spinoffs and real estate sales to restore profitability and boost shareholder confidence. Aside from the separation of the Hometown, Outlet and some hardware stores, the Hoffman Estates, Ill., company announced in May that it would spin off a stake in its Canada division.

Sears Hometown expects its stock to start trading on the Nasdaq under the "SHOS" ticker symbol on Friday.

Sears Holdings shares finished at $58.58 per share on Monday. They are down 32 percent since peaking got the past year at $85.90 in mid-March. They traded as low as $28.89 in early January.