Sears’ lenders reportedly pushing for liquidation
Sears Holdings Corp.’s future is looking grimmer with each passing day.
A group of the cash-strapped chain’s lenders, including Bank of America Corp., Wells Fargo & Co. and Citigroup Inc., are urging the company to liquidate under a Chapter 7 bankruptcy filing rather than reorganize under a Chapter 11 filing, according to a report by the Wall Street Journal. Sears has a $134 million debt payment due on Oct. 15, which the company retailer previously warned it may not meet.
According to reports, Sears CEO and chairman Eddie Lampert, who has helped keep the company float by lending it more than $1 billion over the past several years, does not play to pay the $134 million on Monday.
In comments, analyst Neil Saunders, managing director of GlobalData Retail, suggested that Sears may be past the point of restructuring.
“The latest financials show that group liabilities outweigh assets by some $4.4 billion,” he said. “Not only has this imbalance been present for many years, but it has progressively worsened over time. A restructuring involving further asset sales would do little to fill this hole.”
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