K-mart Holding is buying one of the nation's oldest remaining names in retailing.
The eleven billion-dollar purchase of Sears, Roebuck and Company is winning praise from analysts, who believe the combined operation will be better able to compete with rivals such as Wal-Mart and Target.
The new entity will be called Sears Holdings, the third-largest retailer. The deal was orchestrated by K-mart chairman and Sears shareholder Edward Lampert. Reacting to the news, retail analyst Kurt Barnard calls it "a dream deal made in heaven". He says even if it were to fail, which he doesn't expect, both companies can fall back on a substantial real estate value. Shares of both companies are sharply higher on the news. The new company plans to operate the K-mart and Sears businesses under their current brand names. The merger, seen completed by the end of March 2005, is subject to approval by K-mart and Sears shareholders and regulators. K-mart emerged from bankruptcy in May 2003 and has since turned profitable.