Sears stays alive for now as chairman wins in bidding
NEW YORK — Sears will live on — at least for now.
The company’s chairman and largest shareholder, Eddie Lampert, won a bankruptcy auction for Sears, averting liquidation of the iconic chain, according to a source familiar with the negotiations. The person agreed to speak on condition of anonymity because they were not authorized to discuss the negotiation publicly.
Lampert, who steered the company into Chapter 11 bankruptcy protection in October, is aiming to keep open roughly 400 stores and preserve tens of thousands of jobs.
But how long Sears can survive under the 56-yearold billionaire, who has tried and failed to turn around the company many times before, remains an open question. Cutthroat competitors like Amazon, Target and Walmart also pose challenges that the struggling retailer has so far been unable to overcome.
The operator of Sears and Kmart had 687 stores and 68,000 workers at the time of its bankruptcy filing. At its peak in 2012, its stores numbered 4,000.
Lampert, the only one to put out a bid for the whole company, had sweetened his offer to more than $5 billion over the past few days through an affiliate of his hedge fund ESL after his original bid had been rejected by the Sears board. That included assuming certain liabilities like covering bills to vendors of up to $166 million. Details of the final terms couldn’t be learned.
The plan is not a done deal and must be approved at a hearing on Feb. 1 by a bankruptcy judge in White Plains, N.Y.
The company, hammered during the recession and outmatched in its aftermath by shifting consumer trends and strong rivals, hasn’t had a profitable year since 2010 and has suffered 11 straight years of annual sales declines. Lampert has been criticized for not investing in the stores, which remain shabby.