HOFFMAN ESTATES, IL—Sears Holdings Corp. said Tuesday that its REIT spinoff, Seritage Growth Properties, had commenced a $1.57-billion subscription rights offering for common shares of its stock, which the SEC has declared effective. Previously targeted to launch this coming Friday, the rights offering is being made in connection with SHLD's planned sale-leaseback to Seritage, which will also buy the parent company's share of three joint ventures it entered earlier this spring.

Proceeds from the rights offering, listed on the New York Stock Exchange as SRGRT and due to end on June 26, will be used to fund a portion of the purchase price of 235 Sears- and Kmart-branded stores, as well as SHLD's 50% interests in JVs with Simon Property Group, General Growth Properties and the Macerich Co. The three JVs involve a total of 31 stores valued at $858 million combined.

In all, SHLD expects to realize up to $3 billion in proceeds from the spinoff. Seritage will lease most of the stores back to SHLD, with the remainder being leased to third parties. The spinoff reserves the right to recapture leased space from SHLD, thereby allowing the REIT to reconfigure space for lease to third-party tenants.

"With the completion of the joint venture transactions with three leading shopping mall owners and operators, and the advanced formation of the Seritage REIT, we will become more productive with our physical store space,” SHLD chairman and CEO Eddie Lampert said Monday when the company announced its quarterly results for the 13 weeks that ended May 2. He added that this will position SHLD for “long-term success consistent with our focus on our best stores, rewarding our best members and pursuing our best categories to transform Sears Holdings into a leading integrated retail membership-focused company leveraging our Shop Your Way platform.”

In its most recent quarter, SHLD narrowed its losses compared to a year ago, posting a loss of $2 per diluted share compared to $2.20 per diluted share in the first quarter of 2014. However, same-store sales were down 7% at Sears locations year-over-year and 14.5% at Kmart.