Navigation

Sears chairman bids $5 bil. for bankrupt retailer

Reuters

A dismantled sign sits leaning outside a Sears department store in Nanuet, N.Y., a day after it closed Monday as part of multiple store closures by Sears Holdings Corp. in the United States.

ReutersSears Holdings Corp. Chairman Eddie Lampert confirmed on Thursday he has made a new takeover bid of more than $5 billion for the company, an offer that may significantly increase the likelihood the U.S. department store will be able to stay in business.

His revised offer, details of which were first reported by Reuters on Wednesday, will be assessed by Sears during a Jan. 14 bankruptcy auction. The firm will consider whether the bid offers more value to creditors than a liquidation.

“We believe our proposal will provide substantially more value to stakeholders than any other option, in particular a liquidation,” a spokesperson for Lampert’s hedge fund, ESL Investments Inc., said in a prepared statement.

“[The proposal] is the best path forward for Sears, its associates and the many communities across the United States touched by Sears and Kmart stores,” the statement added. Sears also operates the Kmart discount chain.

Lampert’s previous bid, which fell short of Sears’ expectations, was valued at $4.4 billion. His new bid, made through an affiliate of ESL and disclosed in a regulatory filing on Thursday, assumes more than $600 million in additional liabilities, including taxes, vendor bills and other expenses Sears has incurred since filing for bankruptcy protection last October. That is on top of about $1.1 billion in liabilities Lampert, Sears’ biggest shareholder and creditor, previously agreed to assume.

“He has increased his bid substantially, but it’s hard to know how much more cash is in the mix,” said Todd Feinsmith, cochairman of law firm Pepper Hamilton LLP’s bankruptcy practice.Speech

Click to play

0:00/-:--

+ -

Generating speech. Please wait...

Become a Premium Member to use this service.

Become a Premium Member to use this service.

Offline error: please try again.