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SEARS STRONGER, MORE FLEXIBLE FOLLOWING REPOSITIONING PROGRAM

 CHICAGO, Dec. 2 /PRNewswire/ -- Sears, Roebuck and Co. (NYSE: S) now is a dramatically transformed organization, one that is strongly capitalized for future financial flexibility as a result of its recently completed repositioning program, said Edward A. Brennan, Sears chairman and chief executive officer.
 "As a result of the program's success, our overall debt has been more than halved while total market capitalization has been increased by more than 60 percent," he said. "We have fundamentally reshaped Sears, giving shareholders a superior return on their investment and strategically positioning the company for long-term earnings growth."
 Sears announced late Tuesday it sold Sears Mortgage Banking Group to PNC Bank Corp., the final transaction completing the repositioning program Sears announced in September 1992.
 Today's Sears consists of Sears Merchandise Group, approximately 80 percent of The Allstate Corporation, Homart Development Co., and significant interests in Prodigy Services Co. and Advantis.
 Sears has posted record or near-record earnings in each of the last three quarters, and the value of Sears shares in the marketplace has reached record highs.
 "We are very pleased with the results of this undertaking, which represents, arguably, the biggest repositioning in U.S. corporate history," Brennan said. "Frankly, the proceeds realized from our efforts exceeded our expectations. In addition, the various pieces of the repositioning fell into place more smoothly and quickly than we envisioned when we embarked on this ambitious endeavor."
 The repositioning included:
 -- The initial public offering of approximately 20 percent of the stock of Dean Witter, Discover and Co., followed by the spin-off of the remaining shares to Sears shareholders. This was the second largest stock dividend distribution in U.S. history.
 -- The initial public offering of approximately 20 percent of the stock of Allstate, which was the largest IPO in U.S. history.
 -- The sale of the Coldwell Banker Residential business and Sears Mortgage Banking Group.
 The Sears Merchandise Group restructured in January 1993, which included the closing of the U.S. catalog operation, 113 unprofitable retail stores, and the elimination of approximately 50,000 positions.
 Total proceeds from the repositioning transactions were more than $4 billion and overall corporate debt has been reduced to about $17 billion from $37 billion. Debt-to-equity ratio has declined to 1.7:1 from 3.4:1.
 "In addition, our efforts have been recognized by the financial marketplace," Brennan said. "Total market capitalization, including the spin-off dividend of Dean Witter, has increased by $10 billion to $26 billion over the past 14 months."
 Based on the Nov. 30 closing stock price, the value of a Sears share has increased 74 percent since the repositioning announcement on Sept. 29, 1992, after adjusting for the Dean Witter stock distribution and assuming reinvestment of dividends.
 Brennan said the Merchandise Group has experienced strong sales increases in recent months, leading to a substantial increase in the group's income from continuing operations for the first nine months of 1993 over the previous year. In the first phase of a five-year, $4 billion capital expenditure program, Sears has remodeled about 135 stores this year, primarily upgrading and expanding their apparel merchandise departments. Sears has supported its emphasis on apparel with the aggressive "softer side" advertising campaign introduced in September.
 Brennan said The Allstate Corporation's initial public offering raised $2.4 billion in equity, enabling Sears to pay down significant corporate debt, while recapitalizing Allstate for future operation. For the first nine months of this year, Allstate income was at record levels, increasing to $952.8 million, after minority interest of $89.7 million, reflecting the strength of the Allstate franchise.
 Brennan said that Sears successful repositioning "clearly demonstrates the quality of our people and the soundness of our plans for the future. We are a more flexible and agile company, able to respond rapidly and effectively in a challenging, competitive marketplace."
 -0- 12/2/93
 /CONTACT: Perry Chlan of Sears, 312-875-7079/
 (S)


CO: Sears, Roebuck and Co. ST: Illinois IN: REA SU:

MP -- NY081 -- 9880 12/02/93 14:18 EST
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Publication:PR Newswire
Date:Dec 2, 1993
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