Sears creditor process called biased
Process pushed company toward sale, says former exec Brandon Stranzl
Sears Canada’s former executive chair defended his plan to turn around the embattled retailer, and said his bid to buy the company and save it from liquidation was hampered by a creditor protection process biased toward liquidation.
Brandon Stranzl, speaking publicly for the first time since the retailer began a full liquidation of its remaining stores earlier this month, told reporters the creditor protection process which Sears Canada entered in June was structured as a sale rather than a rehabilitation from the beginning.
“Everybody wanted there to be a going-concern solution that saved the jobs, but there were many obstacles and many rules that seemed to be in place to get in the way,” Stranzl said during a news conference on Monday.
Stranzl stepped away from his role in August and had been in weeks-long discussions with the embattled retailer to buy it and continue to operate it. However, no deal was reached.
Sears Canada began liquidation sales at its roughly 130 remaining stores across the country on Oct. 19. The retailer got the green light from an Ontario court to proceed with its full liquidation earlier this month as it moves toward putting another 12,000 employees out of work.
Stranzl’s comments on Monday also came after Eddie Lampert, the chair and chief executive of Sears Holding Corp., blamed Sears Canada for exacerbating its problems before it filed for creditor protection.
Lampert, whose ESL Investments is the largest shareholder of Sears Canada, said in a blog post last week that the retailer’s reinvention strategy was “untested” and a “less risky strategy ... could have avoided the unfortunate conclusion.”
He added that ESL was not informed in advance that Sears Canada was seeking protection under the Companies’ Creditors Arrangement Act, and was “extremely unhappy” with the decision.