As the retailer struggles to stay in business, Sears announced Friday that it plans to shutter another 80 stores by late March, CNBC reports. The move comes as the brand waits for last-minute bids from investors to keep doors open within the company.
Sears filed for bankruptcy on October 15, 2018. Since then, it announced plans to shut 142 stores, followed by a second announcement to shut an additional 40 unprofitable stores. Now, the company plans to close 43 Sears and 37 Kmart stores, leaving around 400 locations remaining when all is said and done, 100 fewer than the company originally planned to keep running.
Sears has a self-imposed deadline of 4 p.m. Eastern to receive takeover bids on the company as part of its Chapter 11 filing. So far, only Eddie Lampert, Sears’ chairman and head of hedge fund ESL Investments, has made public plans to submit a bid. Lampert said in early December that he planned to offer $4.6 billion for the stores. Per CNN, part of that offer would include forming a new company called Newco to acquire Sears with $950 million investment and a credit bid of $1.8 billion. He also said that he would forgive some of the money he is personally owed by the company.
ESL Investments is Sears’ biggest credit holder and has stated that it intends to keep the company open.
“ESL believes that a future for Sears as a going concern is the only way to preserve tens of thousands of jobs and bring continued economic benefits to the many communities across the United States that are touched by Sears and Kmart stores,” the company said.
A competing proposal from investors dictates that the company should shut down entirely, liquidating all inventory and assets. They believe that this is the best option to stop the company’s hemorrhaging and recoup losses.
So far, Lampert hasn’t submitted a bid, but if he is deemed a “qualified bidder,” his plan could save about 50,000 jobs within the company.
"It feels like family." Across the United States, legions of former Sears workers gather regularly to reminisce about their long careers in retailing. https://t.co/wFLvdK5BRJ— The New York Times (@nytimes) December 28, 2018
Earlier this month, the retailer was blasted for giving company executives $25.3 million in bonuses even as it was struggling to keep doors open and laying workers off during the holiday season.
“They got $25 million in bonuses. Me? I’m late on my bills. The electric company is threatening to shut me off. And I don’t have anything left to spend on the kids this Christmas,” one former employee said, as quoted by NBC News.
The company was founded in 1893 by Richard Warren Sears and Alvah Curtis Roebuck. At one time, Sears was the nation’s largest retailer, with about 350,000 employees. At its peak, it boasted around 4,000 stores.
If Lampert’s bid isn’t made or accepted by the end of Friday, Judge Robert Drain will hear proposals from creditors next month. If Lampert does make a bid, the company will have until the end of next week to decide whether or not to accept it.