NEW YORK (AP) — Lands’ End shares are falling in its first day as a separate public company after being
spun off from Sears.
The company’s stock dropped $2.17, or 6.8 percent, to $29.50 in Monday morning trading.
Lands’
End was publicly traded before Sears Holdings Corp. purchased it in
2002 for nearly $2 billion. Sears hasn’t had much success with it
though, and announced in December that it was going to spin off the
clothing business as a separate company by distributing stock to its
shareholders. It closed on the spinoff on Friday.
Sears received
gross proceeds of $500 million from the separation. That consisted of a
cash dividend paid by Lands’ End to a subsidiary of Sears Holdings
before the spinoff.
The spinoff by Sears has been viewed as a way
to unlock value for investors as the retailer’s core business struggles
after years of sales declines. The company, which also runs Kmart
stores, has been closing some unprofitable stores and sold some store
leases in Canada.
Sears has spun off other businesses over the
past three years, including its Hometown and Sears Outlet stores and its
Orchard Supply Hardware Stores, to raise cash. It has also said it is
considering separating its auto center business.
Billionaire hedge
fund manager and Sears chairman Eddie Lampert, who took over as CEO in
February 2013, has been under intense pressure to turn around the
business. Sears has had trouble adapting as bigger, nimbler rivals such
as Wal-Mart Stores Inc. and Home Depot Inc. have stolen away customers
over the years.
In 2012 Sears announced plans to restore
profitability by cutting costs, reducing inventory, selling off some
assets and spinning off others. Those moves helped the Hoffman Estates,
Ill., company reduce net debt by $400 million and generated $1.8 billion
in cash from the asset sales. Sears also has been building a loyalty
program called Shop Your Way, which accounts for a majority of its sales
and has tens of millions of active customers.
But critics say Sears hasn’t managed to solve its core problem: Its stores aren’t inviting to shoppers.

Lands’
End began in 1963 as a sailboat hardware and equipment catalog. Sears
bought it in 2002. The company is trading on the Nasdaq under the "LE"
ticker symbol.
Sears Holdings will continue to list on the Nasdaq
under the "SHLD" ticker symbol. Its stock rose 58 cents, or 1.4 percent,
to $41.26 in morning trading.
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