Posted on 12/28/2018 8:33:08 AM PST by Black Agnes
Eddie Lampert not only ran the company; he was also its largest creditor and the guy who sold major Sears assets to … Eddie Lampert.
(Excerpt) Read more at prospect.org ...
But just how much did Lampert vacuum out? That’s a surprisingly hard question to answer, if only because of the variety of schemes he employed. Lampert was at one point simultaneously Sears’s CEO, board chairman, transaction partner, landlord, and banker. (Upon the bankruptcy filing, he stepped down as CEO.) Because of his outsized role as Sears’s number-one creditor, he stands to gain in a bankruptcy even if his shares of Sears stock get wiped out. Through this ploy, Lampert has been able to transfer to himself all the salvageable assets of the company. And so far, it’s worked out.
SPJNK.
yes this has been apparent for several years already...it is called DBM (death/dismemberment by management)
a bit unusual for such an iconic and highly-visible company...but it happens to more firms than is probably supposed
the managers take the best, most valuable parts and discard the liabilities either in bankruptcy or by just walking away and leaving them behind to die slow deaths on their own
Sears was a publicly traded company. As CEO, Lampert had a fiduciary duty to not sabotage the interests of the shareholders in favor of his own. I’m not an accountant but on the surface it seems almost akin to embezzlement. The SEC ought to look into it, and sanction or charge this guy if he acted illegally.
You’ll forgive me if I’m not sure what that means.
Another article on the same subject:
Explains in detail all the shenanigans.
Basically once he took over he stopped spending any money in the company’s interests.
Wonder why the stores were all run down? No expenditures on them since ‘07. No concerted effort to capitalize on their distribution network to sell online. He rode it down on purpose for personal gain.
I posted another article in the comment beneath yours. Goes into way more detail of his shenanigans.
were I king for a day, one of the first things I'd decree is that CEO and Chariman of the board of directors cannot be the same person. It's an inherent conflict of interest that works contrary to the interests of the shareholders, which is who the board is supposed to represent. The board cannot be expected to exercise true oversight of hired help like the CEO when the CEO is running the board, leaving the shareholders with no recourse if that CEO is incompetent or a thief.
Yup.
Think about what a retail chain is, and ask yourself a simple question: What assets does it own?
Most retailers have minimal tangible assets. If they own their stores they have real estate, but if they are tenants in shopping centers (I believe this is usually the case) then their major assets are: (1) their brand name, (2) financial service divisions that issue credit to their customers, and (3) their inventory.
For Sears, Item (1) has lost most of its value by now. Item (2) loses its value as customers walk away. Item (3) is a transient asset that comes with a carrying cost (hence the incentive to sell inventory as quickly as possible).
Interestingly, Sears apparently has another "asset" that may be very attractive to buyers: its ongoing financial losses. It appears that Sears' losses can be used by certain buyers (maybe even only Lampert himself) to offset billions of dollars in future taxable income.
It sounds bizarre, but I've heard stranger stories in the business world.
When there’s a crook at the top of a company it always filters down...
I posted another article link further down in the comments.
That’s got some really good info in it as well...
Dude has an interesting Wiki entry too.
Just another example of the slow death of brick and mortar stores.
Way to go Eddie, you’re a successful Captain of Business and a cool guy to boot. I’ll bet you’re the star of the country club. /s
I hope he gets kidnapped again.
Sears still owns a bit of real estate, at least as of this past September. But I can’t find any citation for the current value of the real estate holdings.
I used to be able to make a few dollars off low-cap stocks. For the past few years, it seems that if they go public, someone finds a way to grab the assets.
No.
Read the article(s).
It was deliberate.
Sears died about twenty years ago.
It just took this long for the body to die.
What a shame. They had the fulfillment system 100 years ago.
Lots of companies hit rough spots.
Fortunately few of them have a CEO determined to kill them for personal gain.
Lampert is the reason Sears is dying today.
Motive and opportunity.
Read the article(s).
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