On the last day to submit bids for Sears, a newly formed affiliate of ESL investments, Transform Holdco, pitched two plans. In documents filed with the Securities and Exchange Commission Wednesday, the company outlined an approximately $4.4 billion plan, backed with $1.3 billion of credit, to keep open 425 stores and continue to employ roughly 50,000 workers.
According to the company the first plan is the “best outcome” for debtors, creditors and other stakeholders. But it also offered up an alternative: In the event the first proposal isn’t accepted, Transform Holdco could acquire just 250 stores, certain assets of the Sears Home Services unit, and the data and intellectual property of the Shop Your Way loyalty program, among other things.
The proposals will terminate if they aren’t determined to be qualifying bids by 4 p.m. on Friday, according to the documents, which also note the interest of a real estate bid for $1.8 billion. Also on Wednesday, sources familiar with the matter told The Wall Street Journal that two teams of liquidation firms submitted competing bids to liquidate Sears and sell off the pieces. In an email to Retail Dive, an ESL Investments spokesperson said: “ESL Investments believes that our going concern bid provides the best path forward for the company, the best option to save tens of thousands of jobs and is superior for all of Sears’ stakeholders to the alternative of a complete liquidation.” A Sears Holdings spokesperson declined to comment to Retail Dive.
For years, Sears Chairman (and once CEO) Eddie Lampert helped Sears limp along a retail landscape it once dominated. And now as it faces the potential end, he’s still not ready to give it up, even if that means only salvaging the pieces.
Sears first filed for bankruptcy in October, and Lampert submitted a $4.6 billion bid (through ESL) in early December for Sears, its real estate and brands like Kenmore and its Sears Auto Services. But many, including workers rights activists and creditors alike, balked at the idea that Lampert, who was unable to turnaround the business so far, would be able to do so after bankruptcy.
Later in the month, Sears said it would forego selecting a lead bidder for the auction of its stores amid criticism of Lampert’s bid. Instead the retailer pushed for more bids ahead of the deadline, including from liquidators and others looking to pick up real estate.
The ultimate fate of the retailer will become clearer on Friday once the company and its independent board decide which bids qualify under the sale procedures.