BUSINESS

Target Canada announces 16 closures next week as it winds up operations

03/13/2015 10:45 EDT | Updated 05/13/2015 05:59 EDT
TORONTO - Target Canada says it will shut 16 locations permanently next week, the first wave of store closures that will eliminate 17,000 jobs in total when all is said and done.

Employees at each store will be notified about 10 days before the final day of business at their location, said company representative Molly Snyder.

Ontario is home to half of the stores that have been notified of closures between March 18 and 22. The remainder include three in Alberta, two in B.C., two in Quebec and one store in Manitoba.

Target Corp. announced in January that it would close all 133 Canadian stores, most which opened in 2013 in phases beginning in Ontario, saying it would take years to turn a profit.

The retailer has been in court to iron out the details of its departure, with a variety of creditors that include landlords, suppliers and others impacted by the closures.

Liquidation companies have been overseeing the sale of Target's inventory for about a month.

Last week, leases for 11 former Target Canada properties were sold back to landlords for $138 million before taxes, while others are still on the sales block.

Any store leases that don't find a buyer will return to the landlords after a deadline set for the end of June.

Meanwhile, suppliers of Target Canada are challenging the company's $1.9-billion claim that it owes an "early termination payment'' to a property company it established to hold its real estate assets.

Suppliers are worried that could eat up all the money they claim to be owed in the insolvency — estimated to be around $400 million.

Last week, the suppliers submitted a list of more than 60 questions to Target Canada in an effort to get more clarity around the weeks that led up to the company's insolvency filing in January.

The group is trying to determine how Target Canada went about ordering inventory around the time it made the decision to close down its operations. Suppliers are asking for minutes from the company's board meetings between September 2014 and January 2015, among other things.

Target Canada must provide its response to the questions by Monday, though it can also detail reasons why it refuses to answer.

Court proceedings surrounding the company's wind down are expected to stretch into the summer.

Follow @dj_friend on Twitter.