Sears chairman wins bankruptcy auction saving retailer from downfall
Category: #retail  By Shikha Sinha  Date: 2019-01-21
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Sears chairman wins bankruptcy auction saving retailer from downfall

Sears Holdings announced that the hedge fund owned by Eddie Lampert, its Chairman and largest investor, has reportedly won the bid to acquire Sears and Kmart, the company which owns its chain of department stores. 

Eddie Lampert’s ESL investment will reimburse around $5.2 billion for a shrunken version of the once iconic company, which if approved could save about 45,000 jobs, stated Sears Holdings.

As per ESL, the customers who purchased items with extended warranties will still have those agreements honored, while some severance cost amassed during the firm’s bankruptcy process will also be paid as part of the pending deal.

Sears Holding’s hedge fund stated that ESL has relentlessly helped Sears re-emerge from the bankruptcy at every stage in this process, for instance by enhancing the offer several times, as it believed  the company to have a profitable future and deemed that it has the potential to flourish in today’s competitive retail landscape.

Sources even claimed that Lampert who had contributed billions to save the company amid flagging sales, extended another offer a few days ago pledging to keep 425 stores open and save the jobs of 50,000 workers.

Reportedly, ESL recently tuned the bid in favor of the concerned creditors, however, there’s a strong chance some creditors will still challenge ESL’s offer. However, a committee made up of unsecured creditors, including mall owners, has accused the hedge fund of customizing previous transactions to primarily suit its own benefits.

According to sources familiar with the matter, though innovations can be easily executed with a smaller number of stores, Sears will continue to battle out the same forces that triggered it to file for bankruptcy protection in October 2018. 

The final hearing to approve the sale is scheduled for Feb 1 with the deal anticipated to close around seven days after the hearing, cite trusted sources.



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Shikha Sinha

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Shikha Sinha

Shikha currently manages content operations for a series of news and business portals including MSF, Algosonline, and the like. An electrical & electronics engineer by education, she has prior experience in content & technology writing, content marketing, market resea...

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