The stores to be closed include 271 Kmart discount stores and 12 Kmart Supercenters in 40 states and one Kmart store in Puerto Rico. The company is also cutting about 22,000 jobs.

Kmart, the nation's third biggest discount retailer after Wal-Mart and Target, operates more than 2,100 stores nationwide. The job cuts amount to just under 9 percent of its work force of about 250,000.

"The decision to close these underperforming stores, which do not meet our financial requirements going forward, is an integral part of the company's reorganization effort," said chief executive Chuck Conaway in a statement.

In Hawai'i, Kmart operates four stores on O'ahu in Kapolei, Waikele, Iwilei and 'Aiea. The others are in Kona on the Big Island; Lihu'e, Kaua'i; and Kahului, Maui.

Kmart is also planning to build a Super Kmart Center in Honolulu near Ala Moana Center. The retailer last month extended a contract to buy about 10 acres known as the "Ke'eaumoku superblock," and said it remains hopeful it can proceed with the project despite its financial troubles.

Financing the estimated $50 million project is an issue for the retailer, though local developer Duncan MacNaughton, who is acting as project developer, has said he is confident the retailer will be able to proceed with the store.

Kmart said it anticipates that the sales generated from store closings and related cost savings will be about

$550 million in 2002 and about $45 million annually after that.