retail news in context, analysis with attitude

The Wall Street Journal reports that Sears Chairman Eddie Lampert’s hedge fund, ESL Investments, has come up with a backup plan in case its $4.4 billion offer to acquire the retailer’s operating assets - it would keep about 425 stores open - is not accepted by the bankruptcy court.

According to the story, Lampert “is interested in scooping up Sears Holdings Corp.’s real estate for $1.8 billion, as well as some other assets.”

The Journal writes that “Sears and its independent board members have to determine by Friday if ESL’s bid is ‘qualified’ under the sale procedures approved by the bankruptcy court. If the bid passes muster, Sears and its independent board members will then have to determine if the ESL offer is a better outcome for the company and its creditors than either of the offers from liquidators.”

One reason that the acquisition bid may not succeed is that Sears owes billions of dollars to a wide variety of creditors, some of whom believe that it makes more sense to shut down the company and auction off its assets.
KC's View: