Sears caves to bankruptcy as widespread store closures loom
It was once the world’s largest retailer. Now, US department store chain Sears has filed for bankruptcy, losing a fight for survival in a fresh sign of the tough retail conditions hitting high street giants.
The 125-year-old company said this morning that it plans to close 142 of its 500 stores, having just recently closed 46 outlets.
The Kmart-owner has filed for a Chapter 11 bankruptcy under the weight of more than $5bn (£3.8bn) of debts.
In the 1970s rising competition from lower-priced such as Walmart hurt Sears’ market dominance in the US, but the recent emergence of disruptors such as Amazon has dealt a more lethal blow in the last several years.
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The company has been burning through cash in the last decade, with more than half of the store’s outlets closing as costs weigh on the firm’s balance sheet while a growing number of shoppers move online.
"While we have made progress, the plan has yet to deliver the results we have desired,” said hedge fund manager Eddie Lambert, the firm’s boss, largest investor and landlord.
Sears said in a statement: “The company expects to move through the restructuring process as expeditiously as possible and is committed to pursuing a plan of reorganisation in the very near term as it continues negotiations with major stakeholders.”