Sears offers to its shareholders its 51 percent stake in Canadian business

After failing to find a buyer for its 51 percent stake in the Canadian business,

Sears Holdings Corp. decided to offer up its shares in the Toronto-based retailer to its own shareholders in a rights offering.

The deal, announced Thursday in a communication to investors, is aimed to get liquidity to the US retailer ahead of the Christmas season. The cash injection is estimated to come in at 380 million dollars in proceeds by early November.

Therefore, Sears Holdings Corp. would no longer be the biggest shareholder of Sears Canada, while Sears Holdings’ own CEO and biggest shareholder, Edward Lampert, will be.

Under the deal, shareholders of Sears Holdings will have the right to buy one share of Sears Canada for each share they own at 10.60 dollars per share.

The sale of 40 million dollars Sears Canada shares will leave Sears Holdings with an 11.74 percent stake in the Canadian company.

“Sears Holdings management will presumably in future be directing 100 percent of its attention to the US business,” while Lampert and his hedge fund ESL Investments Inc. will oversee the management of both Sears Holdings and Sears Canada, analyst Keith Howlett of Desjardins Securities wrote in a note to clients.

“The fact that he will purchase shares at 10.60 dollars should provide a near-term floor under the shares,” added Lampert.