It looks like Sears' final hurrah.
Monday marks the final deadline for bidders to submit details of their offers to buy assets from the struggling retailer, which was forced into bankruptcy in October, or stay open and accept Sears Chairman Eddie Lampert’s new $5 billion offer, for which he already coughed up a $120 million deposit.
Lampert’s hedge fund ESL Investment has been persistently trying to keep the 126-year-old retailer alive. On Tuesday, the hedge fund even upped its offer from $4.4 billion to $5 billion in hopes of winning over Sears’ advisers, who rejected the previous bid.
According to a Wall Street Journal report, an independent board of advisers, questioned Lampert’s ability to fully fund the bid, which prompted the deposit.
What’s more, many of Sears’ unsecured creditors, including landlords and suppliers, were also unhappy with the former CEO’s bid, claiming it only benefited him and his hedge fund.
Many of them are pushing for a liquidation instead.
However, despite the back and forth, Todd Feinsmith, co-chair of the Bankruptcy Practice Group at Pepper Hamilton LLP, told FOX Business, that it is still “very possible that a deal with Lampert will be made” since he upped his bid by $600,000.
“He has much to lose. The sticking point with the [previous] bid was that it is insufficient to cover the administrative costs of the bankruptcy, including the fees of lawyers and other professionals,” Feinsmith said.
In a statement to FOX Business, ESL also said it is very confident about its new proposal as well as the requisite deposit of $120 million.
“We believe our proposal will provide substantially more value to stakeholders than any other option, in particular a liquidation, and is the best path forward for Sears, its associates and the many communities across the United States touched by Sears and Kmart stores. We look forward to having our proposal evaluated by the debtors at Monday’s auction,” ESL said.
While Lampert’s bid will probably be the only one that would keep the company’s 425 remaining stores open, he could be faced with some stiff competition as many of the stores up for sale have high real estate values.
Still, Feinsmith said the demise of Sears overall would be “very bad news” for other retailers in malls across the country as many rely on “anchor tenants” such as Sears to generate foot traffic.
“[But] on the other hand, online retailers such as Amazon would benefit because they would pick up additional market share from former Sears customers.”