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Target Canada has stopped a campaign pressuring the retailer to declare bankruptcy as it closes down its Canadian operations.
As part of exiting the country, Target Canada is working to sell leases, valued at up to $2 billion, on the buildings where the stores are located, according to an article from The Globe and Mail, a newspaper in Toronto.
Instead of filing for bankruptcy, Minnesota-based Target agreed this week to make June 30 its deadline for concluding sales of the leases. If they’re not sold by then, “leases will be returned to the landlords,” the Canadian newspaper reports. “The landlords want to get the lease-sale process completed quickly so they can regain control of their properties.”
Target is closing its 133 stores in Canada because the Canadian division was unprofitable. Read more about the closure here.
The landlords pushed for Target Canada to declare bankruptcy so the company could be liquidated more quickly and the buildings wouldn’t have to be vacant long. Shopping centers featuring vacant Target locations are likely to hurt overall business in the surrounding area as well as the neighboring tenants, The Globe and Mail says.
In a bankruptcy case, a “third-party trustee who acts on behalf of creditors would oversee the winding down and liquidation” and set strict deadlines for the process, The Globe and Mail says.
