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Archive for Thursday, March 27, 2003

Sears may sell credit card division

March 27, 2003

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— Sears, Roebuck and Co. said Wednesday it is considering selling its credit card division, considered one of the top customer databases in the retail industry with about 25 million active accounts.

The division was once a major earner for Sears -- in 2002, it accounted for roughly 60 percent of the retailer's net income -- but a number of cardholders who have not been paying their bills has become a growing problem.

The recent credit division difficulties, combined with confusion over the firm's business strategy, drove Sears' stock price down by nearly two thirds from a high of $60 last year.

Sears CEO Alan Lacy said Wednesday he believed the value of the credit operation was "not reflected in today's market valuation of Sears."

Selling the operation would assist the company's cost-cutting attempts after 18 months of slow sales. Sears on Tuesday also announced a pending round of layoffs at its corporate headquarters.

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