The last time I mentioned the Sears Holdings bankruptcy was in 'The Late Show with Stephen Colbert' examines the report that the FBI investigated Trump's possible covert relationship with Russia, when I wrote "Yes, Reuters and CNBC reported Sears stores to stay open after Lampert prevails in bankruptcy auction with a $5.2 billion bid, but that won't be official until Friday, when the offer goes before a bankruptcy judge, who could turn it down...I promise to report on the judge's ruling when it comes down. Until then, consider Sears and KMart 'not dead yet.'" The judge hasn't ruled yet, but this morning CBS 42 in Birmingham, Alabama reported Sears Bankruptcy hearing today.
Some creditors say that Sears should be closed and liquidated.CNBC summarized the situation.
USA Today named one particular creditor who is objecting and the likely timing of a ruling.
- Sears Holdings unsecured creditors will head to bankruptcy court in White Plains, New York on Monday, Feb. 4 to protest Eddie Lampert's $5.2 billion bid to save the company, which owns both Sears department stores and Kmart.
- The offer is the only one that would keep Sears alive, but its unsecured creditors allege misdealing by Lampert under his tenure as chairman and CEO.
- Judge Robert Drain will hear the objections and rebuttals, and make an ultimate ruling regarding the company's future.
Critics, including the company's major unsecured creditors and the U.S. Pension Benefit Guaranty Corp., have protested the deal.If the judge rules today, I'll report it Wednesday, as Tuesday is Lunar (Chinese) New Year. In the meantime, it's time to be a good environmentalist and recycle my comment to A Farewell to “Bargain Shopping at Kunstler's blog for a transition.
The PBGC, which will be responsible for covering the shortfall in Sears' pension plans, said Lampert is trying to back out of deal that required Sears to use its Kenmore and DieHard brands to ease the pension deficit.
The U.S. pension board has accused Lampert's new deal of allowing his fund to take possession of assets that should be used to help the agency cover Sears pension payments.
Sears pensioners won't get cuts either way. But the agency's voice could be persuasive.
Monday's hearing could be extended to Wednesday if it doesn't wrap up in time. The judge is likely to rule almost immediately after the hearing's conclusion, but he could also decide to take more time.
I was wondering when you would get around to writing about the Retail Apocalypse as a topic worthy of its own post. I'm glad to see that you did. I'm especially glad that you paid attention to the demise of KMart. As I've mentioned in your comment section before, Sears gets nearly all the attention, while KMart is usually an afterthought.I've been guilty of that, too, focusing on Sears at the expense of KMart. Time to make up for that neglect by sharing How Kmart Went From Beating Walmart And Target To Bankruptcy.
In October 2018, Kmart's parent company, Sears Holdings, filed for bankruptcy. Kmart first filed for bankruptcy in 2002, making this its second time in just 16 years. However, the struggling company used to be the biggest discount retailer of homegoods in the U.S. — even bigger than Target and Walmart.I'm one of those who call Target "Tar-zhay" and shop there regularly, helping contribute the demise of both Sears and KMart. As I wrote once on my Facebook page, "between Walmart and KMart, I shop at Target."