Canadian Tire Seeks Partner for Credit Card Business
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Canadian Tire, well-known for its automotive and home stores, said it would try to find a financial partner for its $4.4 billion credit card portfolio to decrease funding risks.
The company failed to provide details, however it said the projected partnership would help with efforts to incorporate its financial services business with its retail operations.
In a statement, Chief Executive Stephen Wetmore says, “As a result of that work, we are now well-positioned to explore an arrangement that would allow us to increase our financial flexibility while continuing to enjoy the substantial contributions of our financial services business.”
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The company does not think that any future partnerships will have an effect on its current employees place in the company or with company operations.
The financial services side of the business contributed to 8.4 percent of its total revenue of $3.02 billion in the last quarter that ended in June.
The company said it would create a real estate investment trust through an initial public offering in the fall of 2013 and also named the two top executives for the trust. Ken Silver has been with the company for over 20 years, currently managing its real estate portfolio, as chief executive of the REIT and Louis Forbes has been named chief financial officer and comes from Primaris, a Canadian REIT.
Canadian Tire had a 16 percent rise is the second-quarter profits. Net income rose to $154.9 million, or $1.91 per share.