A bankruptcy judge decided Tuesday to give Sears Chairman Eddie Lampert another chance to buy the retailer out of bankruptcy and save roughly 50,000 jobs.

Sears Holdings had planned to reject Lampert's bid to save the 126-year-old company, which would have put it on a course to liquidation.

Lampert had put forward a $4.4 billion bid to save Sears through his hedge fund ESL Investments. One of the biggest unresolved issues had that it fell short of covering the fees and vendor payment it owes, making it "administratively insolvent."

ESL protested Sears' decision. ESL, which worked over the weekend to improve its offer, pointed to the advisory fees that Sears has racked up during bankruptcy, a person familiar told CNBC. Such fees are part of Sears' administrative expenses.

Ultimately, the bankruptcy judge gave Lampert more time — but at a cost. ESL will now be required to pay a $120 million deposit by 4:00 p.m. Wednesday. Sears will allow Lampert to participate in a previously scheduled auction Monday, when it will compare ESL's offer to others by liquidators. But it's unclear where he will get the funds to back his offer. A person familiar with the situation told CNBC Lampert has been working to get the financing.

The people requested anonymity because the information is confidential.

A liquidation remains a possibility, and even if it comes to that pieces of the storied retailer could still be salvaged, like its home services business.

Lampert's grand plan was to fortify two struggling retailers, Sears and Kmart, by combining them in 2005. But the combined companies became victim of savvier competition, changing shopping habits and, many have argued, poor management.</s>Sears Chairman and ESL Investments founder Eddie Lampert will have one more chance to rescue the iconic retail chain from liquidation, a judge ruled on Tuesday.

As CCN reported, The 126-year-old retailer had hoped to receive approval from a bankruptcy judge to proceed with liquidation after advisers rejected a $4.4 billion takeover bid from Lampert and ESL.

However, according to CNBC, the judge sided with Lampert and ESL, who protested the move. Per the report, ESL must make a $120 million deposit by Wednesday afternoon, which will allow its bid to be compared against liquidator offers when the Sears auction takes place on Jan. 14.

Sears Holdings Corp shares surged on the news, rising to a daily high of $0.365 in the over-the-counter markets as of the time of writing. That represent an increase of more than 125 percent from the daily low of $0.153 which they set on the news that Sears would reject the takeover bid from Lampert and ESL.

If Lampert succeeds in his attempt to rescue Sears from liquidation, it could save as many as 55,000 jobs — temporarily, anyway, as the firm has closed around 40 percent of its stores in the three months since filing for bankruptcy protection in October. Creditors, though, would prefer that Sears liquidate, as Lampert — the firm’s former CEO — made a variety of controversial moves during his tenure as chief executive and they would prefer to cut their losses.

For now, it seems, the “Amazon of the 1930s” will remain on life support, at least for a little while longer.



The post One More Chance: Judge Gives Eddie Lampert Time to Rescue Sears from Bankruptcy appeared first on CCN.</s>A bankruptcy judge is giving Sears Chairman Eddie Lampert another chance to buy the department store chain out of bankruptcy and save roughly 55,000 jobs.

Sears on Tuesday had planned to tell the bankruptcy court it had rejected Lampert's $4.4 billion offer to buy the retailer, after it fell short of covering its bankruptcy expenses. Lampert, though, protested the decision, highlighting the extensive costs of Sears' bankruptcy advisors, a person familiar with the situation told CNBC.

Ultimately, a bankruptcy judge is giving Lampert more time. Lampert's hedge fund, ESL Investments, will now be required to pay a $120 million deposit by 4:00 p.m. Wednesday. Sears will then hold an auction Jan. 14, when it will compare Lampert's offer against others by liquidators.

Since Sears filed for Chapter 11 bankruptcy protection Oct. 15, Lampert has been fighting to keep a few hundred Sears and Kmart stores open.

Sears' unsecured creditors, though, have argued there may be claims against Sears for deals done under his tenure as CEO and its largest shareholder, which include Sears' spinoff of Lands' End in 2014 and transactions with Seritage Growth Properties, a real estate investment trust Lampert created through some Sears' properties a year later.﻿</s>Sears to ask bankruptcy judge to allow liquidation Sears Holdings has rejected Chairman Eddie Lampert's bid to save the 126-year-old company, setting the storied retailer with more than 50,000 employees on a path to liquidation. However, Sears Holdings Corporation rejected Lampert's take-over bid and plans to ask U.S. Bankruptcy Judge Robert Drain if it can proceed with liquidation, people familiar with the matter told Should Sears be allowed to liquidate its assets, it will become one of the most high-profile victims in the wave of bankruptcies that have hit the retail sector in recent years owing to the popularity of online shopping. Liquidation will put #Sears last bid to stave off liquidation has failed



Goodbye to this 130 year old giant: https://t.co/OOf08EEgSX pic.twitter.com/0PR8BJhpAN — Black Friday by DealsPlus (@blackfriday_fm) January 8, 2019 ESL Investments and Lampert not giving up Sources also are saying that Lampert and his hedge fund are protesting Sears' decision to liquidate and are prepared to give the details on their offer to Judge Robert Drain and make the case for saving Sears. Lampert's offer was deemed insufficient by Sears advisers. One of the unresolved issues not addressed was covering the fees and vendor payment it owes, making it "administratively insolvent." However, ESL wants to point out that the extensive advisory fees that Sears has racked up during bankruptcy are part of Sears' "administrative expenses." Some of those unresolved costs include bills from lawyers and financial advisers and are expected to exceed $200 million. Lampert proposed forgiving $1.3 billion of debt he holds in exchange for ownership of the reconstituted Sears, a bankruptcy maneuver known as a credit bid, according to Eddie Lampert's $4.4 billion offer was Sear's only shot at staying alive and preserving 55,000 jobs. But the bid ultimately came up short. https://t.co/E2vdCox5rg — CNBC (@CNBC) January 8, 2019 What Lampert wants out of all this Lampert wants a release from legal exposure related to the transactions he completed with the retailer before it filed for bankruptcy protection. Basically, they make Lampert not only the company's biggest creditor but its biggest shareholder. Lampert also failed to put up any cash to back up his credit bid. Sources are saying this maneuver may not be allowed in court. Additionally, there are still ongoing investigations into Lampert's pre-bankruptcy deals, which the hedge fund manager maintains were proper. Lampert took over Sears in 2005 with an $11 billion deal. He promised to turn the iconic company back to its glory days. Instead, he let the stores deteriorate even as he bought the company's stock and readily lent them money. And it may have been Lampert's plan all along to secure the properties due to their higher real estate value. Philip Emma, an analyst with Debtwire and an expert in retail bankruptcies told Chairman Eddie Lampert submitted a bid last week for $4.4 billion through his hedge fund, ESL Investments., for 425 of Sears' stores, according to Digital Journal However, Sears Holdings Corporation rejected Lampert's take-over bid and plans to ask U.S. Bankruptcy Judge Robert Drain if it can proceed with liquidation, people familiar with the matter told CNBC Tuesday morning. Should Sears be allowed to liquidate its assets, it will become one of the most high-profile victims in the wave of bankruptcies that have hit the retail sector in recent years owing to the popularity of online shopping. Liquidation will put 68,000 employees out of work. The sources also said that the company's vast inventories of tools, appliances and store fixtures will be sold in fire sales.Sources also are saying that Lampert and his hedge fund are protesting Sears' decision to liquidate and are prepared to give the details on their offer to Judge Robert Drain and make the case for saving Sears.Lampert's offer was deemed insufficient by Sears advisers. One of the unresolved issues not addressed was covering the fees and vendor payment it owes, making it "administratively insolvent." However, ESL wants to point out that the extensive advisory fees that Sears has racked up during bankruptcy are part of Sears' "administrative expenses."Some of those unresolved costs include bills from lawyers and financial advisers and are expected to exceed $200 million. Lampert proposed forgiving $1.3 billion of debt he holds in exchange for ownership of the reconstituted Sears, a bankruptcy maneuver known as a credit bid, according to Reuters. Lampert wants a release from legal exposure related to the transactions he completed with the retailer before it filed for bankruptcy protection. Basically, they make Lampert not only the company's biggest creditor but its biggest shareholder.Lampert also failed to put up any cash to back up his credit bid. Sources are saying this maneuver may not be allowed in court. Additionally, there are still ongoing investigations into Lampert's pre-bankruptcy deals, which the hedge fund manager maintains were proper.Lampert took over Sears in 2005 with an $11 billion deal. He promised to turn the iconic company back to its glory days. Instead, he let the stores deteriorate even as he bought the company's stock and readily lent them money. And it may have been Lampert's plan all along to secure the properties due to their higher real estate value.Philip Emma, an analyst with Debtwire and an expert in retail bankruptcies told CNN News, "The desire to control the real estate was his motivation through this long slide. If there's any reason Lampert is still involved in this, it's the value is in the real estate, with a footprint you can't easily replicate for a variety of reasons."</s>They haven’t pulled the plug on Sears yet.

A US bankruptcy judge has agreed to give Sears Chairman Eddie Lampert and his hedge fund ESL Investments another day to sweeten their $4.4 billion bid to buy the 126-year-old department store, The Post has learned.

Judge Robert Drain is requiring ESL to deliver a revised bid along with a $120 million deposit, of which $18 million will be non-refundable if ESL is not the winning bidder, a source with knowledge of the situation told The Post.

The hefty penalty is meant to cover the costs of the delayed offer, the source said.

At the same time, the judge left in place a plan for Sears to hold a Jan. 14 auction of its assets, in which ESL will compete against liquidation firms that would sell off the company’s inventory and assets and shutter it for good.

Judge Drain is also allowing ESL to credit bid, a controversial move that the creditors oppose. It allows ESL to partially pay for the acquisition by forgiving $1.3 billion of loans Sears owes the company.

All bids were due on Jan. 4, when ESL’s bid was rejected by Sears as falling short. In particular, creditors are demanding that ESL put down more cash up front, according to sources.

Representatives for Sears and ESL didn’t immediately respond to requests for comment.</s>We could be saying goodbye to Sears sooner than we think. The company is preparing itself for liquidation after their chairman Eddie Lampert's bid to buy the stores out of bankruptcy fell shorts of bankers qualifications. The news was first reported by Bloomberg.

Last Friday an emergency meeting was called by Sears representatives with liquidation firms and other financial advisers after Lampert's 4.4 billion dollar bid was rejected. If Sears proceeds with the liquidation sale it could go through as early as next month.

The liquidation of Sears could be detrimental to America's struggling retail sector. As stores continue to try and compete with Amazon and consumers changing spending habits, Sears could prove to be the biggest fatality in America after Toys 'R Us.

The only last ditch effort for the retailer is for Lampert to rally an improved bid before a status hearing on Tuesday. He also has a plan to purchase some of Sears holdings including real estate and Sears' brands.

Sears Holdings also includes retail chain K-Mart. Last year the company entered Chapter 11 bankruptcy with over 11 billion dollars in debt. Sears is hoping to be able to restructure their company to save 425 stores and 50,000 jobs. Unfortunately, unless Lampert can come up with a heavily reorganized bid, liquidation is likely.</s>Sears is preparing to go out of business. The company announced it will ask a judge to allow it to liquidate.Sears filed for bankruptcy in October. There was some hope it could be saved from liquidation, but that seems unlikely today.Reuters is reporting that Sears Holdings will ask a bankruptcy judge if they can proceed with liquidation after it could not reach an agreement with Sears Chairman Eddie Lampert.This comes after published reports said that Lampert attempted Friday to have his hedge fund take over hundreds of supposedly more successful stores. It would attempt to save 50,000 of the chain's 68,000 jobs nationwide, but the plan did not meet creditor approval.Lampert acquired Kmart in 2003 and Sears in 2005 and merged them togetherSears has more than a dozen stores, appliance outlets and auto centers in the Bay Area.</s>Sears is alive — for now.

Hours before it was expected to liquidate, the 126-year-old retail icon has accepted a revised bid from chairman and former CEO Eddie Lampert in an effort to stave off liquidation.

The last-minute deal followed an extended hearing in the United States Bankruptcy Court for the Southern District of New York, where Judge Robert Drain gave Lampert a second chance to save the beleaguered retailer after his $4.4 billion buyout offer made at the end of December fell short of covering its fees.

Through his ESL Investments Inc. hedge fund, Lampert is expected to submit his revised proposal along with a $120 million deposit by Wednesday afternoon. It would allow operations to continue at 425 stores as well as potentially retain majority of the company’s 68,000 employees.

Following approval from the bankruptcy judge, ESL would be able to participate in an auction against liquidation bids on Jan. 14.

Once a dominant force in the retail industry, Sears Holdings Corp. filed for bankruptcy on Oct. 15. Over the last several years, ESL has loaned the company more than $2.4 billion in financing, with Lampert remaining Sears’ largest investor. The hedge fund is also the only party that has publicly offered to buy it as a whole, which would prevent the business from being broken up into pieces by liquidators.

Should it liquidate its remaining assets, Sears would join the wave of recent high-profile store closures, including Lord & Taylor, Saks Fifth Avenue and L Brands’ Henri Bendel. It announced late last year the shuttering of another 80 of its Sears and Kmart locations across the country in late March, with liquidation sales at the stores expected to begin in two weeks.

Sears Down to the Wire: Department Store Lines Up a Liquidator as Acquisition Talks Falter

Despite Sears and Kmart Closures, Retail Vacancies Held Steady in Q4</s>On Tuesday morning, it looked like Sears Holdings' (NASDAQOTH: SHLDQ) long-promised turnaround had finally run out of time. The company filed for bankruptcy back in October, and a long-shot proposal from Chairman and former CEO Eddie Lampert is the only hope of keeping Sears and Kmart in business. Yet the company was prepared to reject that proposal at a key bankruptcy court hearing in favor of liquidation.

However, a last-minute agreement between Sears and Lampert's ESL Investments hedge fund provides a short window of time for Lampert to try to keep Sears alive. Still, with customers having abandoned the Sears and Kmart brands years ago, this rescue attempt will probably fail.

An offer with some serious holes

Late last month, ESL Investments put in a formal bid for Sears Holdings' assets, following up on an informal proposal presented several weeks earlier. The hedge fund hopes to keep about 425 Sears and Kmart stores operating, while maintaining control of the retailer's real estate and key brands like Kenmore and DieHard.

ESL valued the final offer at $4.4 billion, consisting mainly of new loans from third-party lenders, forgiveness of debt owed to ESL, and the assumption of certain liabilities by the "new" Sears. That may seem like a generous sum, considering the state of Sears and Kmart, but the company hasn't found it very palatable.

There are several potential land mines. First, creditors have accused Lampert of stripping assets from the company and loading up Sears Holdings with secured debt in a way that unfairly benefited ESL. ESL's offer is conditional on the fund (and Lampert) being released of any potential liability related to issues of this sort. That stance has been a big stumbling block.

Second, ESL's bid doesn't include enough cash to cover all of Sears' vendor payments and legal and advisory fees, raising further litigation risks. Third, there's a good chance that selling off Sears' assets piecemeal would raise more money than what ESL is offering.

The net result is that with the bankruptcy auction looming -- it is scheduled for Jan. 14, less than a week from now -- ESL still hasn't submitted a bid that Sears Holdings finds adequate.

A reversal, just in the nick of time

In light of this impasse, Sears Holdings seemed to be on the verge of asking a bankruptcy court judge for permission to liquidate at the hearing held on Tuesday. However, at the last minute, the company decided to give ESL one more chance to improve its offer.

ESL Investments will be able to participate in the bankruptcy auction next Monday, provided it can come up with a $120 million deposit by 4 p.m. EST on Wednesday. That includes a $17.9 million nonrefundable portion that would fund Sears Holdings' cash burn for the next several days, to appease creditors who have been saying all along that every day of delay reduces the amount of cash that will ultimately be available to repay them.

It's still not certain that Lampert will be able to come up with the $120 million or that ESL will sweeten its bid enough to prevail at the bankruptcy auction. But at least there's still a chance that Sears could survive in some form.

It may not matter

Lampert still faces long odds in his effort to keep some Sears and Kmart stores operating. The company's steep sales declines and massive losses over the past several years prove that the two struggling chains don't really have a place in the American economy going forward. It will be hard for ESL to pay enough to top the alternative of selling Sears Holdings' inventory, real estate, brands, customer data, and non-retail businesses separately.</s>Eddie Lampert will get another shot at keeping Sears Holdings Corp. from liquidation.

The Sears chairman and former chief executive officer must put up $120 million by Wednesday to get a chance to take part in an auction against other bidders, Ray Schrock, Sears’s lead attorney, said at a court hearing Tuesday.

“Hopefully, we’ll be able to get to an auction and have a chance to save Sears as a going concern,” Schrock said.

Lampert will be able to use debt he controls as part of his bid, a process known as “credit bidding,” Schrock said. But the company will reserve the right to review that offer and compare it to others.

The 126-year-old company, the descendant of the mail-order catalog that reshaped American commerce, rejected a $4.4 billion offer for selected stores from Lampert and his hedge fund, ESL Investments Inc., on Friday. As many as 50,000 jobs are at stake.

As late as Monday night, the company had told involved parties it was planning to announce a liquidation before the market opened on Tuesday in New York, according to a person with knowledge of the matter.

The bankruptcy judge overseeing the case said that means Lampert’s use of a credit bid has not been pre-approved. Lampert’s last offer was funded by conversion of debt to equity.

Lampert and ESL Investments rank as Sears’s biggest shareholder and creditor. They held about $2.5 billion in Sears debt as of September, the result of multiple attempts to keep the chain afloat. Lampert has shuttered hundreds of money-losing stores, cut more than $1 billion in annual expenses, and spun off units such as Lands’ End Inc.

It’s not the first frenzied deal Sears has made during its bankruptcy. When the company was in court Nov. 27 to finalize bankruptcy financing, a hedge fund affiliated with ESL swooped in to ignite a last-minute bidding war for the right to lend to it.

“Most likely, the bid still goes nowhere,” said Jared Ellias, a professor at the University of California’s Hastings College of Law. “But it’s part of the dance of ‘having every last conversation.’ Liquidating an American icon is something one should do one’s best to avoid.”
A bankruptcy judge grants Sears Chairman Eddie Lampert another chance to buy Sears and save it from liquidation.