Business

Hedge fund said to sweeten Sears bid

Changes include better terms for the chain, creditors

Bloomberg

A car drives through the parking lot of a Sears store in Montebello, Calif.
Bloomberg A car drives through the parking lot of a Sears store in Montebello, Calif.

Eddie Lampert presented a new bid for Sears on Tuesday that included some concessions as talks to save the bankrupt retailer from liquidation continue, according to people with knowledge of the discussions.

The new offer includes terms that are more favorable to the department store chain and its creditors, including more cash, said the people, who asked not to be named as the negotiations are confidential.

The overall value of Lampert’s offer still is pegged at more than $5 billion, one of the people said.

Parties involved in the talks are evaluating the revised proposal and there are no assurances that a deal to keep Sears in business will be reached, the people said.

The talks are part of an auction for Sears Holdings Corp. that has now stretched in to its second day, after more than 12 hours of discussions on Monday.

A representative for ESL Investments, the hedge fund run by Sears Chairman Lampert that made the offer, didn’t provide comment. A representative for Sears declined to comment.

Sears is scheduled to file a notice of the auction results with the bankruptcy court on Jan. 16.

The bankruptcy auction for the retailer’s assets is taking place in New York City.

Participants have been hesitant to accept Lampert’s previous offer, but are focused more on his proposal rather than bids from liquidators, people with knowledge of the process said Monday.

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Monday’s talks were stalled by disagreements including over ESL’s request for release from certain claims, which would insulate Lampert from lawsuits over its previous turnaround deals, said the people.

The committee of unsecured creditors, the lowest-ranked creditors in the case, said they could sue Lampert for millions of dollars over deals he made during his time as chief executive of the company.

Lampert repeatedly has pointed to the number of jobs at stake in seeking support for his plan, making some lenders wary of being blamed for the collapse of the iconic chain if they refuse to provide funds.

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