DETROIT >> Kmart Corp. will close 284 stores in 40 states and Puerto Rico, cutting about 22,000 jobs, as part of its restructuring under Chapter 11 bankruptcy, the company announced today. None of its Hawaii properties were on the closure list. Kmart to shut 284 stores
in 40 states, ax 22,000 jobsIt says it will keep all
of its Hawaii stores open
By Alexandra R. Moses
Associated PressThe stores to be closed include 271 Kmart discount stores and 12 Kmart Supercenters in cities across the country, including Atlanta, Chicago, Cleveland, Dallas, Los Angeles, Miami, Oklahoma City, Nashville and Phoenix. One store is in Puerto Rico.
Kmart, the nation's third biggest discount retailer after Wal-Mart and Target, operates more than 2,100 stores nationwide.
The job cuts amount to just under 9 percent of its work force of about 250,000.
"The decision to close these underperforming stores, which do not meet our financial requirements going forward, is an integral part of the company's reorganization effort," Chuck Conaway, chief executive, said in a statement.
"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," he said.
The Troy-based retailer released the number of closings as it notified affected employees. The stores will remain open pending bankruptcy court approval.
Kmart said it anticipates that the sales generated from store closings and related cost savings will be about $550 million in 2002 and about $45 million annually after that.
An employee at a store in the Detroit suburb of Novi and one in Atlanta confirmed employees were informed of those stores closing.
"It's just another stupid move," said Norman Beasley, who was shopping today at the Novi store. "What am I supposed to do now, go to Wal-Mart? I don't like them."
Linda Muhammad, who was manning the service desk at an Atlanta Kmart slated to close, said she was disappointed.
"It'll be the third (Kmart) store that I've worked at in 10 years," that has closed, Muhammad said.
Muhammad said she wasn't given details on the closing, but said she liked working at Kmart and wanted to stay with the company. Otherwise she said she'll "just get another people-person job."
Kmart filed for Chapter 11 bankruptcy protection on Jan. 22, following lower-than-expected holiday sales, downgrades by several credit rating agencies and a stock dive.
At the time of the filing, Kmart said it would close a number of unprofitable stores. Analysts predicted anywhere from 250-700 stores could close.