When Sears Holdings said late last year that it would spin off its Lands’ End division to shareholders, it described the move as a way to unlock value within the clothier.
But so far, the newly public clothing company has lost a bit of value in its first day of trading.
Shares in Lands’ End tumbled in their debut on Monday, falling to as low as $28.50. As of early afternoon, the company’s stock was down more than 6 percent, at $29.62.
At that level, the company had a market value of about $889.7 million, far below the $1.9 billion that Sears paid for it 12 years ago.
Perhaps that’s to be expected. Lands’ End has suffered from four years of declining sales, even as its net income rose 58 percent last year, to $78.8 million.
But Sears was supposed to have benefited from the spinoff, beyond receiving a $500 million payout from its former subsidiary on its way out the door. Instead, Sears suffered even more on Monday, tumbling nearly 22 percent by midday to $39.35 a share.
In some ways, that may be because Sears is parting with one of its best-performing assets. The company said that the spinoff was meant to give shareholders a choice in which parts of the onetime retail empire they wanted to keep.
