Sears’ biggest shareholder bids $4.6B for rest of bankrupt chain

Eddie Lampert took his first step toward rescuing Sears Holdings Corp. from bankruptcy with a $4.6 billion bid that would keep hundreds of stores open and preserve about 50,000 jobs.

The preliminary bid, outlined in a filing Thursday, would be funded with about $950 million from a new loan in addition to other debt. Lampert, who holds about $2.6 billion of Sears borrowings, would roll much of that into equity of the reorganized business.

“We believe that a future for Sears as a going concern is the only way to preserve tens of thousands of jobs and bring continued economic benefits to the many communities across the United States that are touched by Sears and Kmart stores,” ESL said in a statement emailed to Bloomberg.

The fund sees “significant strategic initiatives and investments in a right-sized network of large format and small retail stores, digital assets and interdependent operating businesses,” according to the statement.

The 125-year-old retailer filed for Chapter 11 protection last month as it succumbed to a unsustainable debt load and dwindling mall shoppers. The company will have only about 500 stores after this year's closures, down from about 3,500 a decade ago. The lone remaining Indianapolis-area Sears department store, in Greenwood Park Mall, is set to close at the end of the year.

 Also on the closure list is the only Kmart left in Indianapolis, at 6780 W. Washington St.

Lampert’s bid also counts on the roll­over of about $271 million in cash collateral currently supporting a letter of credit facility, and promises to assume $1.1 billion of liabilities stemming from protection agreements issued by Sears Homes Services, gift cards and accrued points under the Shop Your Way program.

ESL is working with a third-party investor it didn’t name. Lampert teamed up with hedge fund Cyrus Capital Partners this month to prepare a joint bid, Bloomberg News reported this month.