Sears Gets Last Minute Bid from Eddie Lampert to Save it From Liquidation

11:45 12/28/2018

One of the nation's most beloved retailers has just escaped liquidation. Sears has won reprieve from liquidation as the company's Chairman Eddie Lampert made a last minute $4.4 billion bid on the bankrupt company. The deadline for offers to buy the 125 year old company was on Friday and Lampert's hedge fund, ESL Investments, made its formal submission just before the 4 P.M. deadline said CNBC. Lampert submitted the offer through an ESL affiliate, Transform Holdco, and it was for 425 of Sears’ stores. To fund the bid, it has a $1.3 billion financing commitment from investment banks, a spokesperson for ESL stated. According to the spokesperson, the bid will "offer employment to up to 50,000 associates,” but that it would depend on “further actions the company may take between now and closing.” It would also reinstate severance protections for “eligible employees.” "Should our bid be accepted and succeed, we expect that the company that emerges from bankruptcy would offer employment to up to 50,000 associates, depending on any further actions the company may take between now and closing, and reinstate severance protections for eligible employees who accept their employment offer," an ESL spokesman said. "In addition, we intend to assume certain of the protection agreements that Sears has sold in the past to reassure customers who have purchased big ticket products such as appliances, televisions, lawn tractors and similar items." Now Sears has until the 4th of January to decide if ESL is a "qualified bidder" and if the company decides the hedge fund is, it can then take part in an auction against liquidation on the 14th. "Sears is an iconic fixture in American retail, and we continue to believe in the company's immense potential to evolve and operate profitably as a going concern with a new capitalization and organizational structure," Lampert stated. He added, "We believe that a future for Sears as a going concern is the only way to preserve tens of thousands of jobs and bring continue economic benefits to the many communities around the United States that are touched by Sears and Kmart stores." Sears also disclosed on Friday that it plans to close 80 more stores, bringing the total closures to over 260. AlixPartners Managing Director Ted Stenger said in an interview with MarketWatch previously that Sears is “the longest-running corporate liquidation probably in history.”0

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