Arthur J. Villasanta – Fourth Estate Contributor
Hoffman Estates, IL, United States (4E) – Sears Holdings Corporation, once the world’s largest retailer and the equivalent of Amazon.com in its heyday, filed for Chapter 11 bankruptcy Monday as a prelude to a “strategic transformation” it hopes will see it bounce back as a far stronger company.
Sears also owns Kmart Corporation, the big box department store chain founded in 1899. Sears Holdings will close another 142 stores by the end of the year. It earlier closed 46 stores as part of the bankruptcy.
The company still had 506 Sears’ locations, including 482 full-line department stores. It also operates 360 Kmart stores.
Eddie Lampert has resigned as CEO but remains chairman of Sears Holdings. He remains the company’s largest investor.
Bankruptcy will allow Sears to “strengthen its balance sheet, enabling the Company to accelerate its strategic transformation, continue right sizing its operating model, and return to profitability,” said Lampert.
“Our goal is to achieve a comprehensive restructuring as efficiently as possible, working closely with our creditors and other debtholders, and be better positioned to execute on our strategy and key priorities.”
The Board of Directors created an “Office of the CEO” to lead the company inthe interim. A chief restructuring officer will help lead the bankruptcy and report to a newly created board committee.
The Amazon of its heyday was widely expected to announce its bankruptcy announcement today (Monday) when it is to repay $134 million it owes to its lenders.
Many employees and analysts blame hedge fund magnate and ex CEO Lampert for Sears’ doom. Sears has lost $11.7 billion since 2010, its last profitable year. Sales have plummeted 60 percent in that time.
Lampert, who is infamous as Wall Street’s “Hedge Fund King,” insists Sears can regain profitability once more.
Lampert, who is widely loathed by company employees, isn’t bailing-out Sears this time like in the past. Instead, Lampert will take bids for some of the company’s businesses and real estate once it files for bankruptcy.
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