Target Corp. has found a tenant for some of the Zellers Inc. stores in Canada it doesn’t want — Wal-Mart Stores Inc.
This story first appeared in the June 27, 2011 issue of WWD. Subscribe Today.
The companies’ Canadian units have inked a deal in which Wal-Mart will assume the leasehold interests of up to 39 sites currently operated by Zellers Inc.
Terms of the agreement were not disclosed. The two companies said Friday that specific locations will be identified later this fall.
The sites are among the 220 possible locations whose leasehold interests Target is acquiring from Zellers Inc., a $1.84 billion deal the Minneapolis-based Target announced in January. The transaction allows Target to open between 100 and 150 stores throughout Canada in 2013 and 2014.
In May, Target selected its initial group of Zellers sites, representing 105 locations in all 10 provinces across Canada. Target will select its second group of sites in the fall. Also in May, Target selected a 180,000-square-foot site in Mississauga, Ontario, as the location of it Canadian headquarters.
Wal-Mart Canada, established in 1994, is headquartered in Mississauga and currently operates 325 stores throughout the country.
Zellers is a subsidiary of Hudson’s Bay Co., which intends to use the proceeds from the Target transaction to pay off Canadian debt and bolster its two department store chains, The Bay in Canada and Lord & Taylor in the U.S.