HUDSON'S BAY TO BUY KMART
By Adnews Staff
The Kmart name will disappear from Canada's landscape by Aug. 1. Toronto-based Hudson's Bay Co. is buying Kmart Canada for $240 million, turning some stores into Zellers Inc. outlets and The Bay stores and closing the rest. The move will give Hudson's Bay 410 Zellers and The Bay locations. About 40 of those will be closed. In addition, Zellers head office in Toronto will move into Kmart's headquarters in Brampton, Ont. Advertising for Hudson's Bay Co. is done on a project basis by various agencies. Kmart was in the middle of a review. Zellers is also reviewing its ad business. Currently, the Saffer Group handles advertising on a project basis. Kmart president George Heller will now be president of Zellers. The chain's former president Millard Barron is leaving the company to pursue other opportunities. Bob Peter has been promoted to the position of chairman of the Bay, Specialty, heading up the expansion and creation of specialty retail formats including Bay Trading Post, bed, bath and kitchen superstores and furniture stores. Robert Buchanan has joined the company as business strategy executive vice-president. Most recently he was a senior retail analyst with NatWest Markets of New York. The deal is expected to close within the next several weeks. Up to 6,000 employees will lose their jobs as a result of the sale. About 65% of those positions are part-time. Kmart was bought last June by an investor group consisting of Capital d'Americque CDPQ, Denver-based Cherokee Ventures Canada and York Management Services of New Jersey. Kmart Corp. of Troy Michigan retained a 14.5% stake in the company.