In what could have been the death knell for one of the most iconic department stores in the world, a bankruptcy court has turned this company's future into something more than a slow, painful, and inevitable disintegration. The court handling the case for the mega-store has accepted a monumental offer from the very person whom many blame for the corporation's sad decline.
Just when it seemed that all was lost, Sears' chairman, Eddie Lampert won an 11th-hour bankruptcy action to keep the 126-year-old retailer from liquidating, saving the 126-year-old establishment form closing its doors forever.
"When @Sears filed for Chapter 11 bankruptcy protection in October, it had 687 stores and about 68,000 workers. As part of Sears Chairman Eddie Lampert's plan, the retailer would reduce its store count to around 400 and whittle its workforce down."
According to Business Insider, "The department store has been losing money and closing stores for years. Many employees and analysts blame Lampert for the retailer's decline."
Now Lampert has stepped in during the eleventh hour to make a move that many are hoping will make the difference between financial life and death for the giant retailer.
"Sears has accepted a bid from chairman and former CEO Eddie Lampert that could keep as many as 425 stores operating, according to a source familiar with the process."
This is GREAT news for not only the employees and shareholders of this onetime behemoth but also for those of us who grew up with our beloved Sears as the "go-to" place for just about anything!
Today's announcement does not mean everything is rosy for the famous company and that they will come out of the situation unscathed. Under the terms of the deal, Sears and K-Mart "would still close stores and let go of thousands of workers," reports BI.
At one point yesterday, everyone thought the ESL bid was dead, sources have told me. But after late-night negotiations and some gamesmanship, ESL and Sears have a deal in principle.
@Sears' chairman, Eddie Lampert, has won a bankruptcy auction to keep the 126-year-old retailer from liquidating. Lampert's bid will keep about 400 stores open and retain 50,000 jobs.
But that doesn't mean that the ailing retailer is emerging from this liquidation crisis unscathed. Under Lampert's plan, Sears and Kmart would still close stores and let go of thousands of workers.
It’s no secret that Sears has been struggling to survive for several years. “The company's sales tumbled from $53 billion in 2006 to less than $17 billion in 2017,” according to Business Insider.
“Lampert has blamed the company's grave decline on the media, shifts in consumer spending, and the rise of e-commerce, among other reasons.”
In the early years of the decline, CEO Lampert used controversial tactics to keep the ailing enterprise alive.
Lampert took on “billions of dollars in loans from ESL, the selling off of valuable real estate, and the slow dismantling of Sears' exclusivity over some big American brands.”
If he is successful in his new strategy that includes paring down the size of the retailer, he just may have made the right decision.
Lampert hopes “the measures would buy Sears more time to execute a transformation that would lead the company back to profitability.”
Critics say that his plan is not viable unless the company reverses policy on some major issues, not the least of which is the deterioration of the infrastructure of many of its stores.
“Some stores have suffered severe decay, such as crumbling walls, cracked floors, collapsing ceilings, and a lack of working toilets for weeks on end, according to store visits and interviews with Sears employees over the past two years.”
Whatever the future holds for this beloved retailer, we are just happy that the powers-that-be are giving it every possible chance for recovery before signing its final death certificate.