Chairman makes $4.6B bid to save Sears
outright liquidation of Sears, which has struggled to get support from lenders and suppliers who aren’t sure that the iconic retailer can survive, and Lampert’s new bid may not quell those doubts.
“It’s a last-ditch effort,” said Farla Efros, president of HRC Retail Advisory. “They want to be able to hold onto any equity that they can actually hold onto, and it’s really about ego and saving face.”
The deal will hand Lampert more money and professional fees while the equity holders and lenders will see their investment evaporate, said Burt Flickinger, managing director of Strategic Resource Group, a retail-advisory firm.
“The longer Lampert stays, the more Sears and Kmart’s combined viability is impaired,” Flickinger said. “He’s trying to perpetuate himself almost as an undertaker to drain more blood out of the body and make more money as he’s doing it.”
Lampert teamed up with hedge fund Cyrus Capital Partners this month to prepare a joint bid, Bloomberg News reported earlier. As for the new debt, Sears said it has various proposals from multiple potential asset-based lenders and is working with them on the arrangements.