Target will assume control of up to 220 Zellers stores and said it will spend more than $1-billion to convert 100 to 150 of them to its own banner within the next two to three years. The move will dramatically reshape the domestic retail landscape, providing solid competition to Wal-Mart and other retailers.

It underscores the growing demand by foreign retailers for Canadian locations to take advantage of the country’s relatively healthy economy. It also opens the door to other U.S. chains, such as Kohl’s Corp., which are believed to be interested in Canadian expansion and are now expected to examine some of the Zellers locations that Target is not interested in.

Current players in the Canadian retail market will see a stronger player aiming for their market share.