Sears has several stores in Rockland County and elsewhere in downstate New York. The court handling the closely-watched business bankruptcy set a recent deadline for the submission of bids to buy the company. If no qualifying bids were submitted, the court stated that it would begin the process of dissolution. According to reports, only one bid was submitted, and it has several problems.
The major problem with the existing bid is that the man behind the bid is also Sears' CEO. Eddie Lampert has been Sears' CEO for several years, and he is also the founder and CEO of ESL Investments, the company that submitted the potentially life-saving bid. ESL offered to pay $4.4 billion to purchase 425 of Sears' stores. The bidder also told the court that it had a commitment of $1.3 billion from several investment banks that would be used to finance the purchase.
Sears' advisors were under pressure to decide whether ESL and Lampert constitute a qualified bidder. The biggest problem with the bid is the potential conflict of interest on the part of Sears' CEO Lampert. Financial experts with no interest in the outcome of the bankruptcy have expressed extreme skepticism about Lampert's motivation and his ability to keep the company operating. If the advisors reject ESL's bid, the company will be dissolved and its assets sold to several parties who have already submitted bids. Lampert may also be planning a "credit bid," in which one or more companies that he controls will "pay" a portion of the price by forgiving up to $1.8 billion of Sears' debt.
Regardless of how Sears' advisors react, extended litigation is almost a certain outcome as Sears' creditors jockey for favorable positions.