- Sears will likely live to fight another day, but its survival plan would still include decimating its store count and workforce.
- When the company 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.
Sears will not go gentle into that good night. Chairman Eddie Lampert has outbid those seeking to shutter the company for good. The former CEO’s $US5 billion offer was accepted, according to a person familiar with the matter. Sears advisers accepted Lampert’s revised bid after two days of negotiations.
Bloomberg was the first to report on the bid’s acceptance. The bid is still awaiting approval from the bankruptcy court.
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 likely close stores and let go of thousands of workers.
In October, when Sears filed for Chapter 11 bankruptcy, the retailer had 687 stores and about 68,000 workers. It closed another set of stores after the bankruptcy filing. Lampert’s hedge fund, ESL Investments, said last week that its bid of more than $US5 billion would save up to 50,000 jobs and keep about 400 stores open. It’s estimated that Sears is currently operating 400profitable stores.
Lampert’s plan also thwarted the company’s unsecured creditors, who called the retailer’s plans to remain open “wishful thinking” and advocated for liquidation in November.
This isn’t the first time that Sears has undergone mass store closures and layoffs. But this plan for survival stands alone in terms of sheer scale. Dozens of stores around the country would close. And, if Sears go through with its plan to cull its workforce, anywhere from 18,000 to 23,000 people would lose their jobs.