Judge Approves Kmart Licensing Agreements

The sheets, towels and kids’ clothing made by Martha Stewart and Disney will stay on Kmart shelves after the discount retailer received Bankruptcy Court approval to continue its licensing agreements with its five major brands.

U.S. Bankruptcy Judge Susan Pierson Sonderby approved Kmart’s request to continue its licensing agreements and pay outstanding accounts with Martha Stewart Living Omnimedia Inc.; Disney Enterprises Inc.; G.H. Productions Inc., which supplies its Jaclyn Smith line; Joe Boxer Licensing; and Kathy Ireland World Wide.

Kmart owes $131,735 to Kathy Ireland, $1.1 million to G.H. Productions and $12.3 million to Martha Stewart.

Kmart Chairman and Chief Executive James B. Adamson said getting the judge’s approval was a key victory for the discount retailer in its restructuring efforts. The five brands account for about $2.7 billion annually in gross sales.

Kmart shares rose 3 cents to $1.68 on the NYSE.