As noted above, the Company had total domestic cash and cash
equivalents of $3.2 billion at July 29, 2006. Since the merger between
Kmart and Sears, the Company's cash flows have exceeded its working
capital, financing and capital investment needs, and management expects
that the Company's cash flows will continue to exceed its operating cash
needs for the foreseeable future.
The Company regularly evaluates how best to use available capital to
increase shareholder value. The Company has and will continue to invest in
its businesses to improve the customer experience and provide the
opportunity for attractive returns. The Company has also repurchased $1.1
billion of its common shares since the merger and expects to continue to
repurchase shares subject to market conditions and board authorization. In
addition, the Company may pursue investments in the form of acquisitions,
joint ventures and partnerships where the Company believes attractive
returns can be obtained. Further, the Company may determine under certain
market conditions that available capital is best utilized to fund
investments that it believes offer the Company attractive return
opportunities, whether or not related to its ongoing business activities.
"Our strong financial position and cash flow generation provide us with
the flexibility to capitalize on a wide range of market opportunities as
they arise. In addition to investing in our business and acquiring our
shares, we are prepared to invest substantial amounts of capital if we
identify other attractive investment opportunities which have the potential
for returns we believe appropriately compensate the Company for the
associated risks." said Edward S. Lampert, Chairman of Holdings.
Any such investments will involve risks, and shareholders should
recognize that Holdings' balance sheet may change depending on the extent
of excess funds and the timing, magnitude and performance of investments
which the Company...