Target speeds up its Canadian exit
Target Corp. is planning to close all of its Canadian stores even faster than originally planned.
A court-appointed monitor overseeing the windup of the Target Canada stores says all 133 locations across the country will be permanently shut down by "as early as mid-April,'' which is about a month ahead of schedule.
Some locations have already ceased operations – 17 stores closed in the middle of March. Another six Target locations will shutter on Monday, while 23 are slated for closure on April 1, and 32 more on April 2.
"It is anticipated that the pace of delivery of vacate notices ... will continue to increase over the next two weeks,'' the monitor wrote in an update filed with the court.
"All stores are expected to be closed to the public as early as mid-April 2015.''
Target Corp. announced in January that it was making plans to leave Canada, saying it would take years to turn a profit after a bungled launch hurt its reputation with consumers. The company is in the process of closing all 133 stores across the country, most which opened in 2013.
A liquidation has been underway since last month, while lawyers are in court trying to iron out the details of Target's departure. A variety of creditors that include landlords, suppliers and others impacted by the closures, are trying to determine what will happen to money they're owed.
On Monday, the court will consider approving the US$2.22-million sale of a variety of intellectual property assets from Target Canada back to its U.S. parent company, including both in-store and outside signs, 28,000 branded shopping carts, and 912,000 shopping bags.
Court documents say that unlike other items owned by the stores, which include electric scooters and shopping cart corrals, the Target-branded items can't be sold in the liquidation process because they're all permanently stamped with the company's name.
"It is not possible to remove the Target branding from most of the (intellectual property assets) without destroying or substantially decreasing their value,'' the monitor said, noting an outside appraiser was involved in the process.
"The external signage cannot be repurposed and in any event has no value based on the third party bids (and) estimates of value that have been received.''
In addition to the sales price, Target Canada believes it will save an extra $1.9 million by shifting the responsibility for removing and disposing of the branded items over to Target Corp.