Troubled US retail giant Sears is considering a revised takeover bid from its chairman’s hedge fund after being left on the brink of liquidation.
The 126-year-old company, which also owns the Kmart discount store brand, was initially preparing to enter into liquidation on Tuesday after failing to reach an agreement over a $4.4bn (£3.5bn) bid.
But at a New York bankruptcy court, Sears’ lawyers told a judge that the company was prepared to consider a revised offer from Sears’ chairman Eddie Lampert’s ESL hedge fund.
Mr Lampert, who is Sears’ largest shareholder, bid for the US chain through an affiliate of his ESL hedge fund, offering to keep 425 stores open and save tens of thousands of jobs, according to the court hearing.
Sears’ lawyers said a revised bid will require Mr Lampert to make a $120m (£94.4m) down payment, through his hedge fund, by 4pm New York time on Wednesday.
The revised bid is not official, and will be evaluated in an auction on January 14 that will compete with other bids from liquidators who are looking to shut down the company.
Mr Lampert’s hedge fund originally submitted a last-minute bid for Sears valued at $4.4bn (£3.5bn) ahead of the December 28 deadline, to stop the retailer from being liquidated.
That bid had included $1.3bn (£1bn) in financing from three institutions, ESL said in a statement.
On the same day Sears said it was closing a further 80 stores in addition to the 182 stores already earmarked for closure by February this year.
Once America’s largest department store chain, Sears had 687 stores and 68,000 workers by the time the Illinois-based company filed for Chapter 11 bankruptcy protection in October.
The retailer, which began as a mail order catalogue in the 1880s, has been in a slow decline mirrored by many high street stalwarts in the UK, overwhelmed by nimbler rivals in the street and online.
ESL said that should its bid be accepted, it expects the company to emerge from bankruptcy.
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