Court Grants Chairman Eddie Lampert One Last Chance to Save Sears
A bankruptcy court is giving Sears another chance, offering Chairman Eddie Lampert a deal to buy the company out of bankruptcy, reports CNBC. Lampert's hedge fund ESL Investments has until 4:00 pm on Wed., Jan. 9 to pay a $120 million deposit to save the iconic retailer. Sears Holdings rejected Lampert's original $4.4 billion bid after advisors deemed the amount insufficient, and had planned to announce its liquidation strategy Tuesday morning. After ESL Investments pays the deposit, Sears will allow Lampert's bid to compete against offers by other liquidators in an auction scheduled for Mon., Jan. 14. ESL is still working to secure financing, a person familiar with the situation told CNBC, and would need to win the bid in the auction to secure Sears. After the auction winner is selected by Sears Holdings, the bankruptcy court will need to approve the deal on Jan. 31.
Total Retail's Take: The demise of Sears has been forecasted for years, but yet no one wants to see the 126-year-old retailer close up shop. This seems to ring true with the bankruptcy court judge, as this last-minute deal comes just as the retailer was planning for liquidation. However, Sears’ future existence isn't yet secure, as ESL Investments has not made the $120 million deposit to the court as of time of publishing. After amounting massive debt and closing hundreds of locations under Lampert's tenure as CEO, it's not surprising that Sears Holdings would be hesitant to accept his bid. Lampert and ESL Investments have fought for years to keep Sears afloat, continually pumping capital into the retailer to keep it in business. If a bankruptcy deal is not reached, the liquidation of Sears Holdings would leave roughly 50,000 employees out of work.