Sears CEO Eddie Lampert offers $400 million for Kenmore

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Sears is closing its last Chicago store

Eddie Lampert, the CEO and majority shareholder of Sears, has put a price ticket on how a lot he is prepared to pay his firm to purchase its Kenmore equipment model: $400 million.

Sears Holdings (SHLD), a cash-starved retailer which owns each the Sears and Kmart chains, has been purchasing Kenmore and a few of its different property for years in an effort to boost extra cash. As soon as a pacesetter in gross sales of home equipment, Sears has fallen on onerous instances resulting from sustained losses and falling gross sales. However the Kenmore model continues to be broadly seen as having worth even when the Sears model has been tarnished.

Lampert wrote a letter to the Sears’ board earlier this yr suggesting now was the time to discover a purchaser for Kenmore. He mentioned he was prepared to make a bid for the model and among the different property himself. Late Tuesday he launched his newest letter to the Sears board, saying he was prepared to pay $400 million for Kenmore and an extra $70 million to $80 million for the Sears Residence Providers division, often known as SHIP.

Lampert mentioned he is ready to shut on the deal in as little as 60 to 90 days.

“Pace and certainty listed here are essential,” he wrote within the letter. “We consider, due to this fact, that an expedited course of is in the very best curiosity of all events concerned.”

Sears declined to touch upon Lampert’s letter.

Sears has misplaced $11.2 billion since 2010, its final worthwhile yr. Gross sales have plunged 60% in that point. There have been a complete of three,500 US Kmart and Sears shops when Lampert merged the 2 manufacturers collectively in 2005. Now it has fewer than 1,000.

And the corporate has offered lots of the remaining shops to an actual property funding firm additionally managed by Lampert with the intention to increase cash. It’s paying lease on these shops to that actual property firm.

Sears Holdings additionally offered the Craftsman model of instruments to Stanley Black & Decker (SWJ) final yr in a deal valued at $900 million.

Lampert’s letter repeated his previous statements that he believes that Sears can nonetheless be rotated regardless of its monetary issues. However he additionally proposed negotiating with lenders to attempt to lengthen the reimbursement schedule for a few of Sears debt and have interaction in different types of renegotiation.

“Collectively, we consider these transactions would contribute to a complete answer to create a viable and wholesome Sears and would offer better worth to all stakeholders than could be out there in pursuing different various,” he mentioned within the letter.

The letter didn’t spell out these alternate options, however Sears warned final yr that there’s “substantial doubt” about its capability to remain in enterprise long run. A chapter reorganization may very well be a type of alternate options.

CNNMoney (New York) First revealed August 14, 2018: 9:36 PM ET

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