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The global fashion business journal

21 Sep 201908:46

Sears chairman has a plan B: new 2.60 billion offer for several assets if the first one is rejected

Edward S. Lampert has an ace up his sleeve in case his first bid, consisting of 4.4 billion dollars, does not receive the status of qualified offer.

03 Jan 2019 — 18:08

Sears chairman has a plan B: new offer 2.60 billion offer for several assets if the first one is rejected



The chairman of Sears has an ace hidden up his sleeve. Edward S. Lampert, who last Friday submitted an offer valued in 4.4 billion dollars to avoid winding-up the company, has a plan B in case the bid does not prosper. The executive considers offering 2.6 billion dollars for some assets.


If, on the contrary, his first offer receives the green light next Friday, the next phase will be open to the arrangement with creditors, in which all the bids are going to be compared. Lampert is realizing the operation through Transform Holdco, an affiliated entity of his investment fund ESL Investments.


Supposing that his first offer could not be accepted, Lampert has explained in detail another alternative on the letter Transform sent to Sears’ financial advisers last Friday. The plan contemplates an injection of 5 billion under the condition that at least 250 stores remain open; 25 million for Sears Home Services business and 150 million for certain intellectual property assets, including the Sears brand and royalties rights, among others.





On another sheet, sent to JLL, ESL details it would be willing to pay up to 1.8 billion dollars for some real-estate assets. This is one of the key elements that could make the offer be accepted, as it would entail maintaining near 50 billion employees from Sears and 175 open stores.


Sears presented the United States equivalent to a voluntary agreement with the creditors last October, and Lampert gave up his position as CEO, though he maintained his position in the council presidency. In case of reaching his objectives, it would be the second time Lampert saves a company from the courts: In 2003, he rescued Kmrt, and one year later he orchestrate its merger with Sears.

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