DETROIT — Amid speculation Kmart Corp. could seek bankruptcy protection, the troubled retailer announced sweeping management changes Thursday and said it was continuing to review its finances.
The company's shares advanced 19 cents to $1.79 on news of the reshuffling.
Kmart announced that its president and chief operating officer, Mark S. Schwartz, had left the company. The retailer also named James B. Adamson, one of its board of directors since 1996, as chairman, replacing Charles Conaway, who remains as chief executive.
It said Adamson would serve as the principal liaison between the board and the company's senior management. Adamson, 53, is former chairman, president and chief executive of Advantica Restaurant Group Inc., which owns and operates Denny's, CoCo's, and Carrow's. He previously was CEO at Burger King Corp. and a senior executive at Target Corp.
Kmart is the nation's third-largest discounter behind Wal-Mart Stores and Target.
The retailer's board conducted a regularly scheduled meeting Monday and Tuesday, but until Thursday's announcement Kmart had refused to comment on its financial state.
The company's downward spiral began last week after officials announced that 2001 results would break even at best because of disappointing holiday sales and suggested they may seek additional financing.
Kmart said it continued to evaluate its finances and business plans for the 2002 and 2003 fiscal years.
On Jan. 2, Prudential Securities Inc. said it would not be surprised if Troy-based Kmart filed for Chapter 11 bankruptcy "if trends do not improve" in the next six months. The financial organization downgraded the discount retailer's stock from "hold" to "sell."
Justin Pettit, a partner with Stern, Stewart & Co., said it was hard to determine what impact Thursday's changes would have. "I think (Chapter 11) is absolutely still an option," Pettit said.
Kmart has about 275,000 employees and 2,105 stores. It has a store and distribution center in Lawrence.
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