Sears has filed for bankruptcy and is planning restructure under a plan to protect itself. Sears Holding Corp is said to be keeping 300 of their shop's doors open but will be closing 142 stores on top of the 46 stores which will close by November.
One reason Sears had to file for bankruptcy is that they're losing money when competing with companies like Amazon. According to the BBC, the company filed for Chapter 11 after they could not meet the $134 repayment on Monday.
According to CBC, this information was received from a source familiar with the plan.
This would be a huge loss as Sears has around 90,000 employees across 700 store locations in the United States.
The sources mentioned that the household familiar brand is planning on selling its assets in court-supervised auctions. These would include Kenmore appliances brand and the home services business.
There might even be a bidding war for those names. Eddie Lampert, the Sears Chief Executive is exploring this option as it can provide a good way to have the main business survive. This is common for businesses if they need to lower the costs of operations, but a bid on the assets could prove to make this very interesting.
Sears is also meeting with banks in an attempt to secure financing to keep itself from going under during the ever profitable holiday season. Lenders are expected to provide several hundred million dollars, but it is likely not going to exceed or hit the goal of $400 million. The bankruptcy court is no joke as it really can save or break the business in question.
Since Sears filed for bankruptcy under Chapter 11, it postpones the U.S companies payment to creditors, so that it has time to sell parts of the business or find a way to pay up.
Even the stock market has not been nice to Sears. In 2014, it sat at a nice $48 USD but now is only at $0.41 USD and has a market capitalization of only $44.36 million.
Sears Canada also filed for bankruptcy and financing but still closed down. Most recently it is now dealing with the difficult process of pensions. Retirees actually had to take a 30 percent cut to their payments.