Sears Canada and JPMorgan end credit card issuing deal
When Sears Canada Inc. and JPMorgan Chase & Co. end their credit-card issuing deal next year in November, the bank will not renew the contract, adding further to the Canadian retailer’s woes.
According to Sears Canada, JPMorgan will carry on servicing its Sears MasterCard and Sears Card until November 15th, 2015.
The two companies say they are looking to sell the credit-card program. JPMorgan says it might be willing to pay up to C$174 million (US$154 million) to Sears, if the circumstances are right. “There is no assurance that such a transaction will be achieved or that the necessary circumstances for the payment will occur,” the retailer wrote on its website.
In October, Sears Holding Corp, Sears Canada’s parent company, said it was planning to sell of most of its 51% shareholding in the Canadian unit as a rights offering to its shareholders.
Sears Canada has faced growing competition from large US retailers that have gained market share in the country.
Ron Boire, Acting President and Chief Executive Officer, Sears Canada Inc., said:
“Our customers will be able to continue to use their Sears Canada cards through to November 2015 and we expect no interruption, with the same service levels provided previously by JPMorgan Chase. In the interim, we will explore options that will enable us to continue to provide the high level of service to which Sears Canada customers are accustomed.”
Sears is in the middle of a turnaround plan in which the under-performing stores will be closed down. Currently, there are 176 stores and over 220 Sears Hometown outlets across Canada.