Posted on 01/16/2019 8:46:55 AM PST by Phillyred
Sears Holdings reached a roughly $5 billion deal with its chairman, Eddie Lampert, early Wednesday to keep the company, and about 400 stores, in operations, according to people familiar with the situation.
The deal came after days of negotiations at the law firm Weil, Gotshal & Manges. Lampert has been trying to buy Sears out of bankruptcy through an affiliate of his hedge fund ESL Investments. The owner of Kmart and Sears had filed for bankruptcy in October, and Lampert's bid was the only one that would have kept it alive.
The offer had strong bargaining tools: It could save up to 50,000 jobs and create an infrastructure to support the continued operations of its businesses like Sears Home Services. But multiple offers that Lampert put forward over the past few weeks have fallen short.
There have been questions about the bid's ability to cover Sears' administrative expenses, like vendor payments and advisory fees. The bid is relying on a $1.3 billion so-called credit bid — funding the deal in part by forgiving debt owed to ESL Investments. Sears' unsecured creditors have objected to its use.
On Tuesday, Lampert seemed unable to bridge the gap, and his offer was effectively dead, people familiar with the matter said. In a conversation with the bankruptcy judge, however, ESL and Sears were instructed to wrap up a deal.
From 11 p.m. Tuesday to 2 a.m Wednesday ET, Sears, ESL and their advisors worked furiously to figure out a solution. Ultimately, ESL moved its offer up by roughly $150 million, including taking on more liabilities, one of the people said.
(Excerpt) Read more at cnbc.com ...
Sears lost its identity long long ago sadly....
Seriously, was a time where, you knew if you needed ANYTHING you could get it as Sears...
Now if you go into one that is still open, you have basically appliances, tools and yard stuff, some furniture, some electronics and a whole lot of clothes...
All their house brands have been sold off at this point, or been driven to valueless..
Bankruptcy 2.0 coming to a store near you in 5-10 years!!
Brick and mortar stores have a hard time matching Amazon because they have to pay high taxes to (rapacious) local governments.
There is no such thing as “free” delivery - the cost of such service is buried in the price of all the products offered for sale, spread evenly as a percentage of cost. Every customer pays a percentage of delivery services, whether or not they actually have an item “delivered.”
Remember the axiom: “There is no free lunch.”
Similar thing in my Sears.
I went to get some deals on tools. Supposedly 30% to 50% off. I pulled up Home Depot and Lowes on my phone and found that the "reduced" prices were still higher than the everyday prices at the big box home improvement stores.
A few years back I bought a power router at Sears. The day I bought it, it broke. A piece had come loose inside and was making a tremendous noise. I undid two screws to see if it was anything obvious. Saw nothing. Put the screws back. The manager at Sears said that I had attempted an unauthorized repair and voided any warranty. I pretty much stopped shopping at Sears then.
Sears shot itself in the foot.
Amazon is now applying the local state sales tax on most purchases.
“also Craftsman-branded”
Lowes is running commercials saying something to the effect that ‘Craftsman tools have finally come home to Lowes’. Pretentious and disrespectful.
I recently bought a 16” Craftsman electric chainsaw. I really like it. I’ve cut up most of a 70’ oak that came down on my front lawn using it. The Home Depot in=house brand Homelite 16” electric saw I had didn’t last one day on the oak. Since it was purchased 6 months prior Home Depot would not honor it. No refund or replacement. I went across the street to Lowes and purchased the Craftsman for less than $10 more then the Homelite cost. I could tell the Craftsman was a good chainsaw when I saw the digger-teeth at the base. Those easily triple cutting speed. Can’t tell you the number of times I’ve torqued that saw down to 0 RPM while cutting. It’s on its second chain and still motors on.
I’m sure Craftsman is on the chopping block too. Keep the name and cheapen the quality until it’s no more.
Yep. Plus brick and mortar stores are personnel-intensive compared to automated Amazon. Chain stores matching Amazon pricing won’t be around long. They could even charge marginally less and I’d still prefer shopping from my couch using search features. The malls aren’t for the faint of heart, anyway.
Highly suspicious deal. Lampert can not be trusted.
I’m sure Craftsman is on the chopping block too. Keep the name and cheapen the quality until it’s no more.
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Just like so many industries now there are only a few companies and they make tools under many brand names. It’s usually the same tool with a slightly different look and a different name on it. Powermatic used to be a great American tool company but now it comes from China and isn’t nearly as good even though the price says it’s top of the line.
I believe Emerson electric used to make all Craftsman power tools but now do it under the Home Depot Rigid brand name.
When I repair my Sears dryer I get parts from Whirlpool.
Another industry that I was involved in for many years sold a product to municipalities. The sales reps from each company would bid on projects, try to say their product was better etc. In the last five years three of the brand names have been bought up by one corporation. So these same three reps would go out and compete against each other even though the product came from the same factory. They would just be slightly different and get shipped out from different doors at the factory.
Of course I also noticed a drop in quality, lead times, customer service etc. These corporations don’t care about the customer as much as they care about squeezing every cent of profit they can get out of it. They would get rid of long time employees who knew everything about it and get replaced by some 12 year old who didn’t know anything but would cost a lot less. I expect they call this “progress” but it isn’t good.
West Marine does. I use the benefit every time I'm in the store.
I don’t know anything about West Marine. They closed a bunch of stores not too long ago, though, and have a major presence as third party supplier for Amazon. They may be marking up the Amazon price to their store prices, which might explain their prices being the same as Amazon’s.
[You can’t fund 400 brick and mortar
stores and match Amazon’s prices.]
Target and Best Buy do and they are still in business....
Toys R Us didn’t and look where they are now....
That’s good to hear. I buy all my major electronics and appliances at Best Buy, so it’s nice to know they honor Amazon pricing. Do you have to ask for it?
Probably so that the administrative expenses (mainly lawyers and investment bankers) would get paid. Notice the problem with the original offer discussed in the original post: "There have been questions about the bid's ability to cover Sears' administrative expenses". So he boosts the offer enough enough to make sure that the various teams of lawyers get paid.
Kick the can.
Kmart here in Tampa are gone...
Adapt, or die.
You have it backwards. Kmart post bankruptcy bought Sears. Sears didn't buy Kmart.
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