Sears set to liquidate assets as it rejects chairman’s $4.6bn takeover bid
US department store Sears could face liquidation today after failing to reach an agreement over a proposed takeover bid by chairman Edward Lampert.
Sears, which also owns low-cost retailer Kmart, will ask a bankruptcy judge today if it can proceed with liquidation, Reuters reported, citing sources close to the matter.
The struggling chain, which filed for bankruptcy in October, received a $4.6bn (£3.6bn) takeover offer from Lampert’s hedge fund, ESL Investments, in a bid to keep the retailer afloat.
But an agreement over the offer has not been reached, putting up to 68,000 jobs at risk, according to Reuters.
The offer from ESL, which is the company’s largest shareholder, included a controversial clause that would wipe out $1.8bn in debts in exchange for the company’s assets. It also called for roughly 500 Sears stores to remain open, retaining 50,000 of the group’s workforce.
Lampert’s lawyers will reportedly present details of the offer in a renewed effort to save Sears.
New York bankruptcy judge Robert Drain, who is presiding over the case, may give Lampert more time to revise his offer, Reuters reported.
The 125-year-old company has suffered a torrid period of trading as customers move towards online competitors such as Amazon.
Sears, which was once the world’s largest retailer, filed for Chapter 11 bankruptcy under the weight of $5bn in debts, hoping to cut its liabilities and costs.
Sears has been contacted for comment.