Sears Files for Chapter 11 Amid Plunging Sales, Massive Debt
Sears is Filing for Chapter 11 Bankruptcy Protection
NEW YORK (AP) – The company, inundated by debt and falling sales, said Monday that it would begin liquidation sales and close another 142 stores before the end of the year. The company that dominated the American retail landscape in the 20th century joins a long list of stores ravaged by changing technology and shopping patterns.
Some stores have pulled out of bankruptcy court and found some stability, but the future of other longstanding retail institutions like Toys R Us are more doubtful.
Hedge fund ESL says it stands by Sears’ decision to file for Chapter 11 bankruptcy protection, though it would have preferred to avoid a court-run process.
The hedge fund is run by now former Sears CEO Edward S. Lampert, who is also the company’s largest shareholder and has been attempting to keep the company afloat with his own money.
An out-of-court resolution “did not prove possible”, ESL said.
“We intend to work closely and collaboratively with other stakeholders to restructure the company’s balance sheet using the Chapter 11 framework as quickly and efficiently as possible and will continue to press forward with the goal of seeing Sears emerge from this process positioned for success as a smaller, less indebted retailer in an integrated retail environment,” ESL said.
