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Eddie Lampert Makes $4.6B Play for Sears, Claims He Will Save 50,000 Jobs

December 07, 2018, 10:00 AM
Filed Under: Retail

ESL Investments Inc., a hedge fund founded by Eddie Lampert, has placed a bid of $4.6 billion to purchase what remains of Sears Holdings Corp. over the objections of other creditors who favor liquidating the troubled retailer. 

According to an SEC filing:

“On December 5, 2018, certain of the Reporting Persons submitted an indication of interest in the acquisition, through a newly-formed entity Newco, of substantially all of the go-forward retail footprint and other assets and component businesses of Holdings."

Lampert proposes acquiring substantially all of the assets of the debtors in the Chapter 11 Cases pursuant to a sale under section 363 of the Bankruptcy Code, as well as substantially all of the assets of non-Debtors, KCD IP, LLC, SRC O.P., LLC, SRC Facilities LLC and SRC Real Estate (TX), LLC.

The bid contemplates a total purchase price of approximately $4.6 billion, comprised of: up to $950 million in cash to be funded with the proceeds of a new asset-based credit facility to be obtained by Newco; a credit bid of approximately $1.8 billion; $500 million in a combination of cash, notes to be issued by Newco, equity of Newco and/or waiver or assignment of deficiency claims (including superpriority adequate protection claims) with respect to secured debt; the roll-over of approximately $271 million in cash collateral currently supporting the LC Facility; and approximately $1.1 billion of assumed liabilities with respect to certain protection agreements, gift cards and accrued points under the Shop Your Way program.

Lampert says that Newco expects to provide offers of ongoing employment to approximately 50,000 employees of Holdings and to reinstate Holdings’ prepetition severance program for the benefit of all eligible employees at close.


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