Sears Canada Stock Plunges On Report Of Planning To Seek Bankruptcy Protection

(RTTNews) - Sears Canada Inc.'s (SCC.TO, SRSC) shares plunged around 23 percent on the Toronto Stock Exchange and 21 percent on Nasdaq after a news report that it is preparing to seek bankruptcy protection within weeks.

Bloomberg reported, citing people familiar with the matter, that the court filing will likely lead to a liquidation, with the business sold off in pieces. As per the report, the company's most valuable assets are real estate, but many of its locations are in lower-end shopping centers, making it difficult to sell them to a single buyer.

The stock had already declined from $1.14 on June 12 before a company warning that there was significant doubt about its future and that it could be sold or restructured.

The retailer has hired BMO Nesbitt Burns Inc. as its financial adviser and Osler, Hoskin & Harcourt LLP as its legal adviser to look at alternatives.

"The company continues to face a very challenging environment with recurring operating losses and negative cash flows from operating activities in the last five fiscal years, with net losses beginning in 2014," it said while releasing first-quarter results.