Dive Brief:
- During a Tuesday hearing in the U.S. bankruptcy court in White Plains, New York, Sears Holdings announced it would forego selecting a lead bidder for the auction of its stores amid criticism from creditors over Chairman Eddie Lampert's $4.6 billion bid through his hedge fund, ESL Investments, The Wall Street Journal reports.
- Instead, the retailer is pushing for more bidders to make offers before the Dec. 28 final bid deadline, according to the Journal. Sears Holdings has already received bids from liquidators, as well as from retailers like Burlington Stores, At Home Group, Dick's Sporting Goods and U-Haul for some of its stores or assets.
- Through bankruptcy filings, Sears previously announced and received approval for a plan to shutter 142 unprofitable stores. In a regulatory document filed with the SEC Tuesday evening, Sears said those store closures are expected to cost roughly $443 million, including $81 million in markdowns, $9 million in severance costs, $335 million in lease termination costs, $12 million in other charges and $6 million in depreciation.
Dive Insight:
It came as little surprise when Sears filed for bankruptcy in October, and perhaps with even littler surprise when its chairman couldn't resist a bid to buy back his company. But creditors and worker activists alike are skeptical at best of Lampert's intentions to keep 500 stores open and 50,000 jobs intact.
"[T]he current workforce does not trust they will have a future with the company under his leadership," Carrie Gleason, policy director and campaign manager for Organization United for Respect and its Rise Up Retail campaign, told Retail Dive in a recent interview. Gleason has been pushing for severance pay for workers affected by both the Toys R Us and Sears bankruptcies.
Sears has until nearly the end of the month to muster up additional bids.
