Sears filed for bankruptcy in October.
Hundreds of Sears stores across the US could be saved in what one analyst called "a last-ditch effort" by company chairman Edward Lampert to buy the company out of bankruptcy. The offer includes up to $950 million in cash through an asset-based loan facility, a credit bid of about $1.8 billion, $500 million in Newco notes, cash, and/or waiver or assignment of deficiency claims, rollover of about $271 million in cash collateral from the LC Facility.
Many retailers that have filed for bankruptcy in recent years, including toy seller Toys R Us Inc and department store Bon-Ton Stores Inc, have liquidated after no viable offers to keep the companies open were made. Finally, ESL would assume $1.1 billion in existing Sears liabilities, such as gift cards the department-store chain issued.
"Sears is an iconic fixture in American retail and we continue to believe in the company's enormous potential to evolve and operate profitably as a going concern with a new capitalization and organizational structure", Lampert wrote in a letter detailing the offer. Lampert stepped down as CEO when the bankruptcy proceedings were announced, but remained the company's chairman and has been expected to submit an offer to buy the chain through his hedge fund. He is also Sears' largest investor. The once dominant retailer has been shuttering stores and laying off employees, with roughly 500 stores still in operation.
CNBC reported that a "stalking horse bidder" will be named on December 15 in bankruptcy court.
ESL's takeover bid features financing from a variety of sources and a complicated structure not uncommon in bankruptcy auctions.