A band aid on a giant gaping hole , Why is he doing this?

This is just financing the cash burn coupled with the dilution of stock that is coming.

Sears gets $425M boost from Citi credit card deal that also boosts shopper benefits

If you're using the Sears credit card to "shop your way," you may find the discounts and deals are about to get better.

But the best deal of all will be for Sears' parent company, which is about to get a much-needed injection of $425 million due to the upgraded credit-card deal with Citi.

Sears Holdings, which has both the Sears and Kmart chains, announced Monday that it is extending and enhancing its deal with the bank for a Mastercard branded with the retailer's Shop Your Way loyalty program.

The changes include improved card benefits, such as additional points for certain purchases, including eligible items at Sears and Kmart stores.

For Sears, which faces a financial crisis as its sales suffer, the deal provides fresh financial runway. Citi is paying $425 million as part of the arrangement.

Sears' stock soared 10.9% to $3.98 in pre-market trading as investors celebrated the sudden influx of cash, but it settled back later in the day to $3.61, essentially unchanged from Friday.

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To extend the new terms of the deal through Dec. 31, 2020, Sears gave up the right to purchase certain assets tied to the credit card program.

“We’re extremely proud of our longstanding relationship with Citi and are excited that this best-in-class offer which rewards Shop Your Way members for activity in their daily lives is now an ongoing part of the value proposition for cardholders,” Sears CEO Edward Lampert said in a statement.

Cardmembers can earn points to be redeemed on Kmart household items, larger products such as kitchen appliances at Sears and glasses at Sears Optical.

Shop Your Way Mastercard now includes 5% back in points on certain purchases at gas stations, 3% back on certain purchases at grocery stores and restaurants, 2% back on eligible items at Sears and Kmart and 1% on "other eligible purchases."

Members already earn points on other activity, such as the Uber and GasBuddy apps.

It’s one of Sears’ “crown jewels.” Time

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@bmy -Very funny. Out of all the Citi cardholders out there, Sears probably makes up a small fraction of their overall business. No matter how hard Eddie pushes the dwindling Sears customer base to get a Sears 5321 card it isn't going to make a huge difference.

@Ti6PSm9-bmy You are right. He is a major stockholder in CITI.

You do realize that Eddie has a stake in Citibank, I think around 20%. That will explain why the push to get credit card apps and the new deal.

The best part of the SHC speaks was when Eddie was talking about how many people signed up for the SYW card. He pretends like it's popular. He doesn't mention how these cards are jammed down the customer's throat with employee's hours and jobs threatened over not making a daily quota that exceeds the daily number of customers.

I hate when Eddie says that best in class nonsense about the credit card. I use Discover and Chase Freedom and I earn points/cash back on every purchase. There is the same structure with certain categories giving more points/cash but I just buy what I would anyway so it doesn't matter. I don't chase points because that's how you spend more than you should.

The difference is that I can redeem my points for a statement credit or a direct deposit into my bank account. I am not limited to purchasing products at 2 stores.

There are many rewards cards out there that offer actual cash back. Citi double cash, Bank of America rewards, Capital One Quicksilver to name a few. Most of these have an interest rate that is lower than the SYW card so if you carry a balance, you save real money there too. Real money. Not 1.59 in points.

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A band aid on a giant gaping hole , Why is he doing this?

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