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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) June 11, 1999
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KMART CORPORATION
(Exact Name of Registrant as Specified in its Charter)
MICHIGAN
(State or Other Jurisdiction of Incorporation)
1-327 38-0729500
(Commission File Number) (I.R.S. Employer Identification No.)
3100 WEST BIG BEAVER ROAD, TROY MICHIGAN 48084
(Address of Principal Executive Offices (Zip Code)
(248) 643-1000
(Registrant's Telephone Number, Including Area Code)
N/A
(Former Name or Former Address, if Changed Since Last Report)
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ITEM 5. OTHER EVENTS
On June 11, 1999, Kmart Corporation issued a press release announcing a $230
million after tax charge; attached hereto as Exhibit 99.1.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
KMART CORPORATION
(Registrant)
By: /s/ Nancie W. LaDuke
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Nancie W. LaDuke
Vice President and
Secretary
Date: June 11, 1999
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Exhibit Index
Exhibit Number Description
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99.1 Press Release
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EXHIBIT 99.1
June 11, 1999
Robert M. Burton
Divisional Vice President, Investor Relations
(248) 643-1040
Mary Lorencz
Director, Corporate Media Relations
(248) 643-1021
FOR IMMEDIATE RELEASE
KMART INDICATES THAT HECHINGER BANKRUPTCY FILING EXPECTED TO HAVE NO
MEANINGFUL EFFECT ON STRATEGY, OPERATIONS
Kmart to take a second quarter non-cash charge of about $230 million
after tax
TROY, Mich., June 11, 1999 -- Kmart Corporation (NYSE: KM) announced
that, as a consequence of the Hechinger Company's filing for
reorganization today, Kmart will take a non-cash discontinued operations
charge in the second quarter of approximately $230 million net of tax.
The charge reflects the probability that, as a result of Hechinger's
bankruptcy proceedings, up to 115 former Builders Square locations
currently operated by Hechinger may become the responsibility of Kmart in
the near term. The Builders Square operations were sold in September 1997
to an entity formed by Leonard Green and Partners and were subsequently
combined with the operations of Hechinger Company. At the time of the
sale, a subsidiary of Kmart also subleased to Hechinger certain former
Builders Square locations, whose leases had been guaranteed by Kmart
since their inception.
"While the precise outcome of the legal process remains to be seen, Kmart
believes that, in light of the Hechinger's filing, it is appropriate to
take the charge at this time," said Floyd Hall, Chairman, President and
CEO of Kmart. "Considering current market conditions, we anticipate that
Kmart will be able to convert or sublease most, if not all, of these
properties within a reasonable period after they are returned.
Fortunately, the cash outflows required by these leases should have no
meaningful effect on the company's ongoing strategy or operations."
Kmart Corporation serves America with 2,151 Kmart retail outlets. Kmart
Corporation common stock is listed on the New York, Pacific and Chicago
Stock Exchanges.
This press release contains forward-looking statements. Factors which may
cause actual results to differ may include the uncertainties associated
with any bankruptcy proceeding, the number of leases taken back from
Hechinger and the timing thereof, any difficulties encountered in
subleasing the stores, and general market and other conditions affecting
the terms for subleases.
