Fu­ture of Sears hinges on Mon­day’s bank­ruptcy auc­tion

The Herald Sun - - Business - BY LAUREN ZUMBACH Chicago Tri­bune

In its 126-year his­tory, Sears grew to be­come the coun­try’s big­gest re­tailer and out­lasted Chicago com­peti­tors like Car­son Pirie Scott, Mont­gomery Ward and Wieboldt’s. Its fu­ture now hinges on a bank­ruptcy auc­tion sched­uled to start Mon­day.

Ed­ward Lam­pert, chair­man and for­mer CEO of Hoff­man Es­tates-based Sears Hold­ings Corp., is try­ing to buy the re­tailer with a plan to keep it in busi­ness and keep up to 50,000 work­ers em­ployed. Lam­pert’s hedge fund, ESL In­vest­ments, sweet­ened its of­fer for Sears this week, bring­ing the to­tal value of its pro­posal to more than $5 bil­lion.

But some of Sears’ cred­i­tors are skep­ti­cal of ESL, and it’s not yet known how the hedge fund’s pro­posal stacks up against other of­fers for the com­pany’s as­sets.

If Lam­pert’s plan fails, Sears could face liq­ui­da­tion – the end of the road for an iconic Amer­i­can com­pany.

On­line shop­ping is part of the story, but Sears’ chal­lenges go back decades. It was slow to re­act to new com­pe­ti­tion from dis­count chains and spe­cialty stores and to changes in shop­ping habits, in­clud­ing a shift away from sub­ur­ban shop­ping malls. Lam­pert was ac­cused of fo­cus­ing on cost-cut­ting at the ex­pense of in­vest­ing in stores. He in­sisted the com­pany was work­ing to turn it­self into a smaller but prof­itable re­tailer.

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