Fitch Rates Sears Holdings' Sr Unsecured Debt 'BB'; Lowers Sears Roebuck to 'BB'

Business Wire, March 28, 2005

CHICAGO -- Fitch Ratings has announced the following rating actions upon completion of the merger of Kmart Holding Corporation (Kmart) and Sears, Roebuck and Co. under a new holding company named Sears Holdings Corporation (Sears Holdings):

New ratings:

Sears Holdings

-- Senior unsecured debt 'BB';

-- $4 billion, 5-year senior secured revolving credit facility 'BBB-'.

The Rating Outlook is Negative.

Downgrades:

Sears, Roebuck and Co.

-- Senior unsecured to 'BB' from 'BBB-'.

Sears Roebuck Acceptance Corp. (SRAC)

-- Senior unsecured to 'BB' from 'BBB-';

-- Commercial paper to 'B' from F3.

The ratings of Sears, Roebuck and Co. and SRAC are removed from Rating Watch Negative, where they were placed on Nov. 17, 2005, following Sears' announcement that it would be merging with Kmart. SRAC had $2.7 billion of domestic term debt and $685 million of commercial paper outstanding as of Jan. 1, 2005. Kmart had $95 million of debt outstanding as of Jan. 26, 2005.

For additional information, refer to Fitch's Feb. 2, 2005 press release on Sears Holdings Corporation ('Fitch Assigns Prospective Ratings to Sears Holdings Corporation '), which is available on the Fitch Ratings web site at www.fitchratings.com.