Saturday, 19 Jan 2019

Captain Ahab Lampert's Law Can not Save Sears in Trouble

Say this about Eddie Lampert: It's nothing s? It's not persistent.

A securities deposit Thursday shows that he made a $ 4.6 billion bid for Sears Holdings Corp., the retail giant who was forced to protect itself from bankruptcies in October after years of deterioration under the management of Lampert. This effort would keep hundreds of stores and save 50,000 jobs.

The Sears who would stay would be an envelope of his old self. At the end of its last fiscal year, the company employed 89,000 people. five years earlier, it had 274,000 workers in the United States and Canada.

Spending more time on Sears could have a sad meaning for Lampert, the main creditor who has been keeping the company afloat with financial engineering for years. As Bloomberg News so aptly described last week, the bankruptcy has plunged Sears into a "wonderland of Wall Street" where, for the uninitiated, the hike could seem to be declining.

If the buyback allows Sears to hang on longer than expected, it may help temporarily stabilize other investments in Lampert, such as Lands & End Inc., which still sells clothing in its stores, and Seritage Growth Properties, the REIT. he created to buy the Sears Real Estate.

But this attempt to rescue the 11th hour seems like a useless exercise, as the main activities of Sears and Kmart are so irrelevant and irreparable.

Consider that consumer sentiment has been pretty strong this year. In fact, Target Corp. CEO Brian Cornell said it may have been the best consumer environment he has seen in his career. A large number of retailers benefited, including Sears, Macy's Inc. and Kohl's Corp., whose shares rose as a result of improved performance. And yet, comparable sales continued to fall for Sears. If this can not be better in this very favorable context, when will it ever be?

Lampert has plenty of ideas to prevent Sears' death, including an earlier attempt to sell the Kenmore brand earlier this year. But the problem is that few of them aim to make Sears or Kmart a better retailer. This is the essential fault at the base of all these machinations.

At this point in the Sears saga, retail scribes have used almost every conceivable metaphor to say that this society is doomed. It is said to be a vital support, a zombie, undead.

When it was announced last week that a public offer to buy Lampert was underway, I sent an email to the Bloomberg Intelligence analyst, Noel Hebert. , to ask him if it was "a reshuffle of deck chairs on the Titanic". "Probably more like trying to climb in some lifeboats, themselves damaged by the iceberg, while they are in the middle of a hurricane in the Atlantic."

That's how far this thing is.

I guess I'm happy that the remaining Sears workers will eventually be able to bring their paychecks back longer. But they should watch the outings before being, like this iconic company, supplemented by Lampert's illusions.

To contact the author of this story: Sarah Halzack at

To contact the editor responsible for this story: Daniel Niemi at

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Sarah Halzack is a columnist for Bloomberg Opinion, which covers the consumer and retail sectors. Previously, she was a retail journalist for the Washington Post.

© 2018 Bloomberg L.P.


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