Sears, Amazon forge deal to sell Kenmore online, tie in Alexa
Shares of Sears Holdings Corp. rose Thursday after the company announced an agreement to sell its Kenmore appliances on Amazon. com, a reassuring sign for a retailer that’s been rattled by e-commerce upheaval.
In addition to offering the Kenmore lineup on Amazon’s site, Sears will integrate its smart appliances with Alexa — the tech giant’s speech-activated assistant. That means the company’s air conditioners and other devices will respond to voice commands.
The announcement brings fresh hope that Sears can adapt to a rapidly shifting retail landscape. Department-store chains have been hard hit by sluggish mall traffic and online shopping. By teaming up with Amazon, Sears brings new life to its more-than-century-old Kenmore name and opens up a new sales channel.
“The launch of Kenmore products on Amazon.com will significantly expand the distribution and availability of the Kenmore brand in the U.S.,” Sears Chief Executive Officer Eddie Lampert said in a statement.
The Amazon deal sent Sears’ shares up as much as 24 percent in Thursday trading, the biggest intraday gain since May 25. The shares rose 92 cents, or 10.6 percent, to close Thursday at $9.60. The stock had been
down 6.6 percent this year through Wednesday’s close.
Shares of rival appliance sellers got hammered. Home Depot Inc., Lowe’s Cos. and Best Buy Co. all fell at least 4 percent on Thursday, underscoring concerns that shoppers will start buying more large appliances on Amazon.
Terms of the partnership weren’t disclosed, and it’s unclear how much help Sears will get from the arrangement.
But the company is badly in need of growth.
Once the world’s largest retail chain, Sears has racked up more than $10 billion in losses over the past six years.
In another blow, Sears Canada Inc. — partially spun off from Sears Holdings in 2012 — went to court in June to seek protection from creditors.
Leaders at Sears’ flagship chain have also voiced concerns about its outlook this year.
The company added socalled
going-concern language to its annual report filing in March, acknowledging there was “substantial doubt” about its future. The move sent the stock on its biggest decline in more than two years.
Lampert, a hedge fund manager who serves as Sears’ largest investor, has used his own money to help keep the business afloat.
Earlier this week, his investment firm agreed to lend Sears an additional $200 million.
Sears had said last year
it was seeking a buyer for its Kenmore name, along with the DieHard battery and Craftsman tool brands. It sold Craftsman to Stanley Black & Decker Inc. this year for about $900 million, but the other two brands remain part of Sears.
The Kenmore name first appeared on a sewing machine in 1913, then expanded to washing machines in 1927. The lineup later grew to encompass everything from microwaves to the Lady Kenmore electric shaver.