Sears plans to close doors after 126 years chairman's bid fails

Irving Hamilton
January 8, 2019

The iconic retailer is expected to announce its liquidation plans this morning to a NY bankruptcy judge after a bid from the company's chairman to save it fell through.

After two long delays at a morning hearing in bankruptcy court, attorneys for Sears announced it had accepted a revised bid from a hedge fund controlled by Eddie Lampert, the chairman and former CEO of Sears.

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One of America's most iconic businesses, which has been in business for over 125 years and still employees 68,000 people, is on the verge of liquidation after an eleventh-hour, $4.4 billion takeover bid failed to satisfy advisers to the company, which hasn't turned a profit in almost a decade. His offer, though, was deemed insufficient by Sears' advisers, the people said. Lampert, though, protested the decision, highlighting the extensive costs of Sears' bankruptcy advisors, a person familiar with the situation told CNBC. Such fees are part of Sears' administrative expenses.

A liquidation could still salvage pieces of the storied retailer, like its home services business. Its fall from grace saw it swing from being the "first everything store" to a business that couldn't compete when "everything" was found online after Amazon arrived. The 126-year-old company, whose closure would be among the most high-profile retail bankruptcies in recent years, struggled to convince suppliers to keep shipping it merchandise by touting the $300 million in financing it has secured in November so that its business could operate through the holidays. The combined companies became victim of savvier competition, changing shopping habits and, many have argued, poor management. "A bankruptcy auction for Sears' assets is not due until January 14". Sears' last profitable year was 2010 and it has lost $12 billion since then. It employed 68,000 workers at the time of its filing. Sears did not immediately respond to requests for comment.

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