HOFFMAN ESTATES, IL—Sears Holdings Corp. saidThursday that its board has approved the sale of up to 40 millionshares of Sears Canada Inc., a move that couldgenerate as much as $380 million. With an eye toward shoring up itscash holdings ahead of the holiday selling season, the financiallybeleaguered retailer is reducing its share of its Canadianoperation to a minority stake of about 12 million shares. Itexpects at least $168 million in US proceeds by mid- to lateOctober, with the balance coming in the following month.

Much of the early proceeds from the sale will come fromEddie Lampert and ESLInvestments, which he controls. SHLD's chairman and CEO,Lampert owns 48.5% of its stock. SHLD borrowed $400 million lastmonth from ESL affiliates. The short-term loan is secured byfirst-priority liens on 25 SHLD-owned properties.

Separately, Sears Canada said Thursday that it would cooperatewith the parent company's rights offering and that it had agreed toamend its licensing deal with SHLD. The Toronto-based company saidit would continue to use the Sears name and certain other brandnames associated with its product lines as long as SHLD maintains a10% stake, down from the current trigger of 25%.