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Lands' End is a great brand that might be better off if it wasn't part of Sears, some retail industry watchers are saying.

A spin-off of the Dodgeville, Wis., catalog business into a separate company could be a welcome outcome of Kmart Holdings Corp.'s proposed acquisition of Sears, Roebuck and Co., one camp says.

The other -- which includes Sears -- believes Lands' End could add value to the merged operation if it remains in the fold.

"I think that will be good for Lands' End to be its own public company," said James E. Schrager, a clinical professor of entrepreneurship and strategy at the University of Chicago Graduate School of Business. "Lands' End was a wonderful company that Sears has done absolutely nothing for."

But Chris DuBois, a senior manager with Deloitte & Touche's Milwaukee office, said he'd hate to see Sears sell off Lands' End. "Sears could keep it and make it work. There's a lot of upside to it."

Sears has given no indication that Lands' End will not be a part of Sears-Kmart after the transaction closes next spring.

Still, speculation about a possible separation of Lands' End continues to mount.

Possible methods for separating Lands' End from its parent company include a sale, a leveraged buyout by Lands' End management or a public stock offering.

No one, however, has come up with the name of a possible buyer for the catalog business.

Some analysts say Sears' 2002 acquisition of Lands' End was a mistake that may be undone as a result of Kmart's anticipated acquisition of Sears for $11.5 billion.

Sears bought Lands' End as a way to boost sales on the soft side of the store.

The Lands' End customer profile was a good fit with the demographics of buyers of Sears appliances and tools, and Sears aimed to use the preppy brand to lure those affluent shoppers to the apparel and home goods departments.

"In hindsight, it has been an acquisition that hasn't worked," said an equity analyst who asked for anonymity.

Sears has had a tough time attracting new customers to buy the brand in its stores, he said. And the longer the brand is sold at Sears, the greater the risk of cheapening it.

"It's a strong company, still," said Jan Owens, assistant professor of marketing at the University of Wisconsin-Parkside School of Business and Technology.

But Sears blew the opportunity with the way it's marketed Lands' End, Owens said.

It underestimated the interest that middle-class America would have in buying Lands' End fashions at Sears, and then didn't stock enough styles, Owens said.

"When you did go in, it was so skimpy, why bother?" she said.

Sears announced recently that Lands' End merchandise is selling well in Sears' top 300 stores, but was lagging at the bottom 300.

"We're being more strategic about what we put there," Sears spokesman Chris Brathwaite said of the underperforming stores.

When the Sears-Kmart deal was announced a month ago, Sears Chairman Alan Lacy said the transaction could result in the conversion of hundreds of Kmart locations into Sears Grand stores, a new off-mall format that the company has been testing at various locations across the country.

It is too early to say what the stores will look like after the transaction with Kmart is completed, Brathwaite said, and way too early to speculate on the future of the Lands' End brand.

"Lands' End is a very important brand for Sears. As a company, we're excited about the possibility of a Sears-Kmart merger and what it can mean for consumers."

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