By Barry Ellsworth
TRENTON, Ont. (AA) – Shares of Sears Canada lost 25 percent Wednesday on reports the financially floundering company will file for bankruptcy protection in the next few weeks.
Shares fell to $(CAN)0.60 on the Toronto stock exchange after the reports said Sears is preparing the court filing or liquidation.
After petitioning for bankruptcy protection, the company will probably sell off its stores individually because many of the outlets are in lower-end malls and that poses a problem to sell to one buyer, the Financial Post reported.
Sears has about 16,000 employees in its 94 stores and 23 Sears Home stores.
Pending bankruptcy is bad news for shareholders, who are at the last in line to be paid, coming after lenders and other creditors. It is feasible the stock would be worthless, the Canadian Broadcasting Corporation reported.
Sears lost $(CAN) 321 million in 2016-17 and $(CAN) 700 million in the last three years, according to reports.
In early June, the company said it had “significant doubt” that it could survive after it was unable to borrow $175 million and could only get lenders to ante up $109 million, the Financial Post reported.
Sears Canada did not immediately respond to media inquiries.