UPDATE 2-Sears Canada CEO resigns as retailer works on turnaround

Tue Sep 24, 2013 1:48pm EDT

* COO Douglas Campbell to take over immediately

* McDonald steps down to join unidentified international company

* Shares fall as much as 2 pct

Sept 24 (Reuters) - Sears Canada Inc Chief Executive Calvin McDonald has resigned just as the department store chain restructures amid intensifying competition from U.S. retailers such as Target Corp and Wal-Mart Stores Inc .

Chief Operating Officer Douglas Campbell will become CEO with immediate effect, Sears Canada said, adding that McDonald is joining an international company it did not identify.

The Globe and Mail newspaper, citing sources familiar with the situation, said McDonald's departure was sparked by differing views with U.S. parent Sears Holdings, controlled by investor Edward Lampert.

The disagreement was tied to "the pace at which capital was being deployed to keep the momentum of the transformation going," the newspaper quoted the source as saying.

Vincent Power, Sears Canada's director of corporate communications, declined to comment directly on the reports.

"I do not know of those differences...I say it is just speculation, it is nothing I comment on because it's not facts that I am aware of," Power told Reuters.

Sears Canada, 51 percent owned by Sears Holdings Corp , announced a three-year plan in 2012 to reclaim lost market share that included making radical changes to its pricing strategies and sprucing up stores.

The company posted its 18th quarterly fall in revenue in the second quarter.

Sears Canada also closed two high-profile stores in the Toronto area and sold back the leases earlier this year.

McDonald told Reuters in January that he was not entirely happy with the company's progress in the 19 months since he took the top job.

Power said he did not have the details on the company McDonald was joining, but it was an "exciting opportunity."

Campbell joined Sears Canada in March 2011 from Boston Consulting Group, where he led turnaround projects and was named COO last November.

Shares of Sears Canada, which has a network of 181 corporate stores, fell as much as 2 percent to C$12.11 on the Toronto Stock Exchange on Tuesday. The stock was down at C$12.29 in early afternoon trading.

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.