Lampert's purchase, made through his hedge fund, ESL Investments, is meant to keep 425 Sears and Kmart stores open, preserving some 45,000 jobs.
A US bankruptcy judge on Thursday approved Sears Holdings Corp Chairman Eddie Lampert's $5.2-billion takeover of the beleaguered retailer, allowing the department store chain to avert liquidation and preserve tens of thousands of jobs. Drain has repeatedly expressed a desire to save the jobs of as many of Sears' employees as possible.
A competing bid by Abacus Advisory Group LLC, made on behalf of most Sears creditors and landlords, had meant to shut down and liquidate the company.
"A clear communications process with vendors and employees is really warranted", Drain said.
But Abid Qureshi, an attorney who represents the creditors who want to shut down Sears, said the deal should not close unless ESL agrees to pay the full $166 million - or the judge orders them to do so.
Over the next few years, Lampert's business plan calls for him to sell about $200 million a year in real estate and more than $900 million in assets overall, according to court testimony Thursday. Schrock said that disagreement still needs to be settled before a sale can close. Drain said he could not rule on the issue Thursday, but suggested that ESL would be forced to assume that debt.
The bankruptcy-court drama began in October when the 126-year-old retailer filed for Chapter 11 protection after years, and billions of dollars, of losses.
The company that will emerge from the bankruptcy proceedings will be a shell of its former self. And Sears has indicated in its filings that it expects to transition out of large stores of about 160,000 square feet to stores less than one-tenth that size. The government pension insurer is taking over the company's underfunded pension plans.
Further, the experts opined that to make sure that Sears will survive and get past the hurdles, the bosses must modernize the aging store and give it a major facelift.
"We believe in the potential to create a successful, multi-faceted, 21st century company that can benefit from the changes in today's retail environment", said a statement from his hedge fund earlier this month.
Once a mainstay in American shopping malls, Sears, which also owns Kmart, has closed nearly 3,000 stores and cut more than 250,000 jobs since 2007. Gymboree and RadioShack are both recent examples of those trends.