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Sears Files for Chapter 11; Lampert Steps Down as CEO
Sears Holdings filed for Chapter 11 bankruptcy early Monday morning ahead of $134 million in debt coming due, and Eddie Lampert has stepped down as CEO. He will remain chairman of the board.
The company said it would close another 142 stores. A roster of specific locations was not immediately available.
The company has received commitments for $300 million in senior priming debtor-in-possession financing from its senior secured asset-based revolving lenders. It’s negotiating a $300-million subordinated DIP financing with Lampert’s ESL Investments Inc.
In a statement, Lampert said that although progress has been made in transforming the business, “addressing the company’s immediate liquidity needs has impacted our efforts to become a profitable and more competitive retailer.” The Chapter 11 process will give Sears Holdings “the flexibility to strengthen its balance sheet, enabling the company to accelerate its strategic transformation, continue rightsizing its operating model and return to profitability.”
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