Lampert’s ESL Investments wants Hoffman Estates-based Sears Holdings Corp. to restructure more than $1 billion in debt and sell about $1.5 billion in real estate and about $1.75 billion other assets, including the company’s popular Kenmore appliance brand, according to a proposal made public in a regulatory filing Monday.
ESL offered to buy Kenmore and certain other divisions of the retailer’s business in April. But the latest proposal is broader and pushes the company to act more quickly in the face of “significant near-term liquidity constraints,” including a $134 million debt payment due next month.
Sears said it had received ESL’s proposal and directed the company’s management and advisers to work with the hedge fund. A board committee already negotiating with ESL on the proposal to buy Kenmore will review the proposed real estate deal, Sears said.
He wrote that he still thinks Sears can get back to profitability as a smaller company
The latest rescue attempt is also complicated because ESL is controlled by Mr. Lampert, who has an unusual role at Sears. He is chief executive and chairman of the retailer. And in addition to being the largest shareholder, his hedge fund holds roughly 40 percent of Sears’s debt, giving him claim on a great deal of the company’s assets, particularly its real estate.
I’m highly confident Sear’s management at this point would rubber stamp anything that the CEO or his hedge fund would do, as any competent managers would’ve left already or are playing along with the CEO’s games for their own gain.