Sears STAYS in business as federal judge approves

[cadence4u]

Sears STAYS in business as federal judge approves last-minute $5.2 billion bankruptcy sale to ex-CEO Eddie Lampert
A bankruptcy judge blessed a $5.2 billion plan by Sears chairman and biggest shareholder to keep the iconic business going

The approval means roughly 425 stores and 45,000 jobs will be preserved
Judge Robert Drain rejected the committee's claims that the sale process was unfair and flawed
Eddie Lampert's bid through an affiliate of ESL hedge fund overcame opposition from a group of unsecured creditors
Lawyers for Sears and ESL argued that the sale offered the best deal and also preserved jobs

A bankruptcy judge has blessed a $5.2 billion plan by Sears chairman and biggest shareholder to keep the iconic business going.

The approval means roughly 425 stores and 45,000 jobs will be preserved.

Eddie Lampert's bid through an affiliate of his ESL hedge fund overcame opposition from a group of unsecured creditors, including mall owners and suppliers, that tried to block the sale and pushed hard for liquidation.

In delivering his decision Thursday, U.S. Bankruptcy Judge Robert Drain for the Southern District of New York rejected the committee's claims that the sale process was unfair and flawed, that it shut out any other parties who could have been interested in buying the business and that Sears had more value to its creditors if it died than if it lived.

Lawyers for Sears and ESL argued that the sale offered the best deal and also preserved jobs.

Drain is expected to enter his order on Friday, making it official.

Even with this latest reprieve, Sears' long-term survival remains an open question. Lampert hasn't put forth any specific reinvention plans and the company still faces cutthroat competition from Amazon, Target and Walmart. Meanwhile, its stores look old and drab.

Lampert steered Sears into Chapter 11 bankruptcy protection in October. The company's corporate parent, which also owns Kmart, had 687 stores and 68,000 employees at the time of the filing. At its peak in 2012, its stores numbered 4,000.

Sears was hard hit during the recession and outmatched in its aftermath by shifting consumer trends and strong rivals. It hasn't had a profitable year since 2010 and has suffered 11 straight years of declining sales.

Lampert's original plan had been rejected by a subcommittee of the Sears board. ESL sweetened the bid several times before the subcommittee gave it the OK.

A group of unsecured creditors, who rank at the bottom of the list to be paid, filed objections to the sale, alleging falsified financial projections, excessive buybacks, and a spinoff of key brands that stripped the business of key assets.

'The tortured story of Sears reads like a Shakespearean tragedy,' the group said. 'Lampert and ESL managed Sears as if it were a private portfolio company that existed solely to provide the greatest returns on their investment, recklessly disregarding the damage to Sears, its employees and its creditors.'

Lampert personally owns 31 percent of the Sears' outstanding stock, and his hedge fund has an 18.5 percent stake, according to FactSet. He stepped down as CEO in October after serving in that role since 2013.

Under Lampert's watch, Sears has survived in part by spinning off stores and selling well-known brands like Craftsman tools. He has also lent some of his own money.

Lampert has been criticized for not investing in his stores. Even Senator Elizabeth Warren, a Massachusetts Democrat and potential presidential candidate, has attacked him and questioned his commitment to Sears workers.

'I am concerned that under your leadership, Sears may continue to struggle and employees will continue to face uncertainty and anxiety over their future employment, and ongoing risks to their benefits and economic security,' Warren wrote in a letter to Lampert made available to The Associated Press by a worker advocacy group.

One of the lawyers for Lampert's hedge fund testified earlier this week that the 56-year-old billionaire has been portrayed as a cross between J.Gould, the late railroad tycoon, and Barney Fife, a fictional character in the popular TV show 'The Andy Griffin Show.'

Drain, the bankruptcy judge, acknowledged that Lampert had been subject to 'verbal abuse.'

'He is a wealthy individual and a big boy,' Drain said. 'And I guess he can take it.'

But he added that Lampert 'has an opportunity to not be a cartoon character.'

[alina6]

I still shop at sears. It would be a shame to see them go.

[DEBMZ6]

I'm so glad that 425 store have been able to remain open but it saddens me that our Sears will be closing after being at our mall for 40 years. 

[vickysue]

It is sad to see Sears  slowly go down hill.  We shopped all the time at Sears. Ordered  so much from them in the 60's  to the  70's  as we lived in rural areas and it was quite a haul to go to a major town to shop.  Then in 1982  I went to work for them and enjoyed it  so much. Was so sorry when the catalog  closed up. But  things happen. I think if we had closed out all of the  satellite stores in the  small  towns  we would not have had to close the  big stores. they were draining us.  by sending  all of their customers to us  who wanted to return items that  we did not sell to them.  Oh well. Guess that is the way it  goes.  Maybe  they will bring a catalog back. Montgomery  Wards has a small one. I get it.
 

[Tresbn00]

I did not know that we could cut and paste articles from on line media sources. It kind of detracts from posting as I like to read posts that come from peoples minds and hearts. In either case, Sears is a dinosaur and can not keep up with today's shopping on line shopping venues. Sears has high rental over head at shopping malls (also a thing of the past), costly management, and a minimal online presence. I believe that they still advertise in tangible news papers which only a small percentage of people subscribe to and an even smaller percentage take time to read the advertisements. Although Eddie Lambert seems to be a knight in this fairy tale, he is also a creditor and share holder. Lambert will have class A rights to having the credit that he extended to Sears payed back when Sears goes back into bankruptcy.

[fillfran82]

Sears STAYS in business as federal judge approves last-minute $5.2 billion bankruptcy sale to ex-CEO Eddie Lampert
A bankruptcy judge blessed a $5.2 billion plan by Sears chairman and biggest shareholder to keep the iconic business going

The approval means roughly 425 stores and 45,000 jobs will be preserved
Judge Robert Drain rejected the committee's claims that the sale process was unfair and flawed
Eddie Lampert's bid through an affiliate of ESL hedge fund overcame opposition from a group of unsecured creditors
Lawyers for Sears and ESL argued that the sale offered the best deal and also preserved jobs

A bankruptcy judge has blessed a $5.2 billion plan by Sears chairman and biggest shareholder to keep the iconic business going.

The approval means roughly 425 stores and 45,000 jobs will be preserved.

Eddie Lampert's bid through an affiliate of his ESL hedge fund overcame opposition from a group of unsecured creditors, including mall owners and suppliers, that tried to block the sale and pushed hard for liquidation.

In delivering his decision Thursday, U.S. Bankruptcy Judge Robert Drain for the Southern District of New York rejected the committee's claims that the sale process was unfair and flawed, that it shut out any other parties who could have been interested in buying the business and that Sears had more value to its creditors if it died than if it lived.

Lawyers for Sears and ESL argued that the sale offered the best deal and also preserved jobs.

Drain is expected to enter his order on Friday, making it official.

Even with this latest reprieve, Sears' long-term survival remains an open question. Lampert hasn't put forth any specific reinvention plans and the company still faces cutthroat competition from Amazon, Target and Walmart. Meanwhile, its stores look old and drab.

Lampert steered Sears into Chapter 11 bankruptcy protection in October. The company's corporate parent, which also owns Kmart, had 687 stores and 68,000 employees at the time of the filing. At its peak in 2012, its stores numbered 4,000.

Sears was hard hit during the recession and outmatched in its aftermath by shifting consumer trends and strong rivals. It hasn't had a profitable year since 2010 and has suffered 11 straight years of declining sales.

Lampert's original plan had been rejected by a subcommittee of the Sears board. ESL sweetened the bid several times before the subcommittee gave it the OK.

A group of unsecured creditors, who rank at the bottom of the list to be paid, filed objections to the sale, alleging falsified financial projections, excessive buybacks, and a spinoff of key brands that stripped the business of key assets.

'The tortured story of Sears reads like a Shakespearean tragedy,' the group said. 'Lampert and ESL managed Sears as if it were a private portfolio company that existed solely to provide the greatest returns on their investment, recklessly disregarding the damage to Sears, its employees and its creditors.'

Lampert personally owns 31 percent of the Sears' outstanding stock, and his hedge fund has an 18.5 percent stake, according to FactSet. He stepped down as CEO in October after serving in that role since 2013.

Under Lampert's watch, Sears has survived in part by spinning off stores and selling well-known brands like Craftsman tools. He has also lent some of his own money.

Lampert has been criticized for not investing in his stores. Even Senator Elizabeth Warren, a Massachusetts Democrat and potential presidential candidate, has attacked him and questioned his commitment to Sears workers.

'I am concerned that under your leadership, Sears may continue to struggle and employees will continue to face uncertainty and anxiety over their future employment, and ongoing risks to their benefits and economic security,' Warren wrote in a letter to Lampert made available to The Associated Press by a worker advocacy group.

One of the lawyers for Lampert's hedge fund testified earlier this week that the 56-year-old billionaire has been portrayed as a cross between J.Gould, the late railroad tycoon, and Barney Fife, a fictional character in the popular TV show 'The Andy Griffin Show.'

Drain, the bankruptcy judge, acknowledged that Lampert had been subject to 'verbal abuse.'

'He is a wealthy individual and a big boy,' Drain said. 'And I guess he can take it.'

But he added that Lampert 'has an opportunity to not be a cartoon character.'

Hello!

I'm saddened to see sears stores closing down I used to enjoy shopping there. I guess many stores just can't compete with Amazon the giant. Even I'm doing more shopping online I guess it's the new trend.

[dsawan]

happy but no sears near me. closed last year.

[plennis]

I am always sorry to see the older stores gp I do not know why they did not continue with the on line sales.  That seems to be a wave of the future and they were already into it.

[Nancy5]

i get sad when stores close.  In the last 7 weeks we lost BonTon and KMart and I guess it's just a matter of time until Sears goes.  I'm at fault also, I do a lot of shopping online

[pectacon]

Our Sears here closed years ago. Honestly I rarely even shopped there personally but am sad to see them go downhill after being in business so long. Times change I guess they could not keep up.

[NRAJOE]

I loved Sears...our last one in the area closed about a year and a half ago....always bought Craftsman tools and Diehard batteries for the autos...can still get the tools at ACE and a couple other stores but its not the same...

[jkhanson]

Our local Sears left years ago.  I enjoyed their service for their appliances.  We had a maintenance agreement that kept our treadmill in tip top shape for years.

The malls seem to be losing popularity to the downtown shops as they cycle revolves.

[ancmetro]

     I think Sears is a lucky survivor with so many other major stores going out of business.
     We love you Sears.

[bremer51]

I have always appreciated Sear's Kenmore and Craftsman products.

[BATISTAGIRL663]

Glad they can stay open Sears was always a big part of our school shopping when we were younger that’s where mother would get our clothes from a lot of the senior stores around here are closing anyways but hopefully some of them can stay open where you can continue to shop online if not at a retail store itself