Kmart official named top finance executive for Sears Holdings

Sears' current CFO loses out to Crowley

February 22, 2005|By Becky Yerak | Becky Yerak,CHICAGO TRIBUNE

Sears, Roebuck and Co.'s top finance executive will leave the retailer after its proposed merger with Kmart Holding Corp. is completed next month.

The combined company, to be called Sears Holdings Corp., said William Crowley, 47, Kmart's senior vice president of finance, will become chief financial officer of the merged retailer.

As recently as Feb. 15, Sears Roebuck CFO Glenn Richter, 42, had been identified as the new finance chief for Sears Holdings.

But in a Securities and Exchange Commission filing Friday, Sears Holdings said Crowley would be CFO and that Richter would leave the company after the merger.

The filing also said Sears stock will trade on the Nasdaq stock exchange under the ticker symbol SHLD and that the meeting for both companies' shareholders to vote on whether to approve the merger will be held March 24.

Richter was unavailable for comment yesterday.

"He felt he could better satisfy his career goals by pursuing a position outside the company, as he assessed his career options inside and outside the company," said Sears spokesman Chris Brathwaite.

Richter also will leave as chairman of Sears Canada, of which Sears owns 54 percent.

Asked what Richter's career goals are, Brathwaite replied, "He hasn't specified his future plans."

Richter has been Sears' point man on a transition team integrating the two retailers.

To some outside observers, the change suggests that the shots are being called by Kmart, even though the merged company's headquarters are to be in Hoffman Estates, Ill., where Sears is based.

When Sears and Kmart announced their $11 billion merger in November, Sears' workers took solace in knowing that the merged company would do business out of familiar confines.

But workers are bracing for job cuts that will be necessary if Sears Holdings is to achieve its target of $300 million in cost savings through reduction of administrative and operating expenses.

Other issues to be resolved include how many stores will be sold, what other assets will go on the block and how store workers will be compensated.

"That's information we won't be able to talk about until after the merger closes," Brathwaite said.

Although hundreds of Kmart stores will be converted to the Sears' name, Sears is starting to operate more like Kmart in some ways.

Sears Holdings has said that it will be more restrictive about granting stock options and that, unlike Sears, it won't pay a dividend.

Also, seven of 10 Sears Holdings board members are from Kmart, according to a Securities and Exchange Commission filing last week.

"Kmart bought Sears, so it doesn't surprise me that Kmart executives are taking high-level jobs in the new organization," said Gary Ruffing, senior director of consulting firm BBK Ltd. and a former Kmart marketing vice president.

"They can get some cost savings out of rent and selling some leases, but the biggest thing is the duplication of jobs, in the field, buyers, human resources, accounting," he said.

The Chicago Tribune is a Tribune Publishing newspaper.

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