Legit Reviews

NEW YORK (CNN/Money) - Kmart Corp. is acquiring Sears, Roebuck & Co. in an $11 billion merger that aims to merge the best of both brands and create a low-priced shopping haven in malls.

CNN Story

Is it just me, or does this not make any sense? KMart has closed down many stores across the country in the past few years. I thought they were going for broke??

KMART is far from broke... from their "rebirth" in May 2003 to now there stock went from $13 a share to over $115 a share.

This is what happened... KMART was headed in the wrong direction and was broke. They filed Chapter 11 bankruptcy in 2002. When doing so they closed almost 600 stores and let 57,000 employees go. By doing this and getting new management the stores rebounded so quickly that in 2003 they were back on the NYSE in May of 2003!

So basically if you would have invested in KMART stock back in May of 2003 it would have gone up 600% in just 1.5 years! ;)

KMART is the lean mean Martha Stewart marketing machine that is trying to regain its old dominance in the market.

Wow. I didn't realize they rebounded so quickly! I just remember them going for Chapter 11. I guess when I think of a company filing for chapter 11, I think that they are done for with no hope of coming back. I was wrong!

Chapter 11 provides protection from creditors while a company reorgainizes, It rarely means the are out of money.
It was intended to save otherwise viable companies from temporary market problems.
Unfortunatly over the last few years we have seen it used (misused) to void Union contracts, limit or elimnate pensions and healthcare benifts and other binding agreements.
Chapter 7 is usually used to liqudate the assets if the debit exceeds the assets plus a reasonably expected future income.

BTW Martha Stewart both the corperation and the convict are making a fortune off this.
I wonder if Martha got a tip?

And the really weird thing is Sears paid more than 1/2 billion to K-mart over the last few years to buy up the stores and properties K-mart was closing, and now they have them back.

yeah... just money already spent that they get back...