U.S. hedge fund manager Eddie Lampert-controlled Sears Canada Inc is preparing to seek court protection against creditors in the coming weeks, a person familiar with the matter said on Tuesday.
A Sears Canada representative was not immediately available for comment.
The business may be sold off in pieces after the court filing which will likely lead to liquidation, the person said.
The company had last week said it was exploring strategic options, including a sale of the company, following years of declining sales.
The company’s sales have fallen every quarter since it was spun off from Sears Holdings Corp in 2012.
Sears Canada, much like Sears Holdings, now its fourth-largest shareholder, has struggled for years to remain relevant to shoppers who have switched to stores that keep up with fast-changing fashion trends.
Bloomberg had earlier reported on the company preparing to seek court protection against creditors.
By John Tilak
(Reporting by Kanishka Singh in Bengaluru)
Photo courtesy of Reuters/Larry Downing