Sears Canada’s stocked has leaped this morning following a reported that states that the company is preparing to seek bankruptcy protection within weeks to come.
There shares dropped to 25% to 60 cents on the Toronto Stock Exchange shortly after the opening on Wednesday.
The stock had already declined from $1.14 on June 12, prior to a company warning that there was no doubt about its future and that it could be traded or restructured.
The struggling retailer is loaded with losses and seen its stock dive, losing more than 80% of its value in the last year, despite efforts to reinvent itself at a time when more Canadians are shirking bricks-and-mortar in favor of online shopping.
Sears Canada didn’t immediately comment on the article by Bloomberg that says the national retailer is preparing for a court filing or liquidation.
Sears Canada announced that it has gone bankruptcy protection in the Great White North and will close 59 stores and slash nearly 3,000 jobs while it tries to get back on its back after a years-long collapse.
The Toronto-based company and its American counterpart have been suffering from decreasing sales for years from changes to consumer buying patterns and new competition, particularly from online shopping. The company which was turned off from sears holding in 2012 won protection from creditors under Canada’s equal to a Chapter 11 known as Companies Creditors Arrangement Act and said it plans to exit bankruptcy protection as soon as possible in 2017, better positioned to executive a turnaround.
As for Sears Canada, its much-hoped for comeback involves selling more discounted designer fashions and its own house brands while also improving its e-commerce, things its rivals have been doing for years. In the month of April, sears Canada said that its 2016 to 2017 loss was up to $321 million.