Target to buy leases of Canada's Zellers for $1.9BMINNEAPOLIS (AP) — Target is expanding north, agreeing to acquire most leases of Canadian retailer Zellers and planning to open its first Canadian stores in 2013.
By: Associated Press, INFORUM
MINNEAPOLIS (AP) — Target is expanding north, agreeing to acquire most leases of Canadian retailer Zellers and planning to open its first Canadian stores in 2013.
Target Corp. said Tuesday it will pay $1.83 billion Canadian ($1.85 billion U.S.) for the 220 Zellers leases from Hudson's Bay Co. Target aims to open 100 to 150 Target stores throughout Canada in 2013 and 2014. Hudson's Bay will sublease the stores back from Target and keep operating them as Zellers for a period of time.
Target also says it will try to sell its credit card receivables portfolio, a move some activist investors have pushed for a long time.
Target will pay the fee in two parts of $912.5 million Canadian ($923.5 million U.S.) in May and September of 2011.
Target's Chief Marketing Officer Michael Francis will oversee the expansion.
he discount chain has been opening new stores, remodeling others and expanding food offerings at its stores as it competes against rivals like Wal-Mart Stores Inc. and dollar stores.
Target, based in Minneapolis, currently operates 1,752 stores, all in the U.S.
The Hudson's Bay Co. also operates department store Bay, home products seller Home Outfitters and discount chain Fields in Canada.
It will still operate some Zellers stores.
Copyright 2011 The Associated Press.