While Sears Holdings divested of assets, it also experienced one wave after another of store closures as retail weakened and sales declined. And the decline and asset sales continue today under Transformco. In January, for example, the company sold five Kmart leases to Target. Service.com blamed Sears for the failure of the deal, saying in court documents that a data room set up to sell the home improvement business was not updated quickly or sufficiently with information, affecting the company`s ability to secure financing for the acquisition. The latter also has a tortured history with Lampert and ESL at the center. During the bankruptcy, Sears Holdings, still under Lampert, received an offer to Service.com, a contract for contracts and home renovations, for the service sector. However, other experts point out that the days of independent Kmart stores are probably numbered. „Obviously, they`re all going to disappear soon,“ Mark Cohen, director of retail studies at Columbia University, told CNN. „This movie is over, and we`re watching the credits endlessly.“ Transformco also appears to own the historic Kenmore appliance brand as well as home improvement company sears Home Services. „For me, it was always like a liquidation. This has been going on for years,“ said Reshmi Basu, retail insolvency expert at Debtwire. Scott Carr, president of Transformco Properties, said the company „continues to look for opportunities to create value from its real estate portfolio and work with retailers, homeowners and communities as part of the ongoing reinvention of commercial properties.“ Sears was tied to a department store sector that was declining in the face of the rise of big-box players and out-of-mall shopping. Sears` decision to cease its catalog business in the early 1990s was also a fatal mistake, as Egelanian believed this had happened just before the rise of e-commerce, a form of digital catalog commerce.
„They had built this company on a foundation similar to the Amazon Foundation,“ Egelanian said. „They wanted to sell everything to the Americans.“ „The company could somehow move forward,“ Neil Saunders, globaldata`s chief executive, said in an interview. „There is no love for consumers, no relevance for consumers. The whole company is a shell of what it once was. There is no intention to [operate] as a legitimate retailer. It`s a financial game. There are probably things to do with real estate, but as a viable retail business, there is no future there. After Lampert founded Transformco and bought the remaining Stores from Sears, he struck a deal to buy the home services business as well. Service.com was challenged with Sears Holdings over a $6 million bond, which Sears Holdings said was confiscated when the deal failed. (They eventually settled in and shared the money, with the lion`s share going to Sears.) In addition to the network of assets, Sears Holdings – back when it had money – regularly distributed millions to shareholders in the form of buyouts and made large financial bets with its money. A good argument can be made in favour of the fact that the takeovers provided Sears with less money to invest in its operations as the industry began to undergo rapid technological and competitive changes.
Sears has become a multifaceted mammoth. In addition to the catalog and retail as well as its own brands, it housed an insurance company, a real estate company and a credit card (Discover), among others, which were eventually separated. According to the plaintiff, Sears Holdings was insolvent until 2014, if not earlier. Lampert and other defendants „knew this, but still pursued other asset transfers for their own enrichment“ as the company recorded massive losses and optimistic forecasts in its budgets, the lawsuit said. Transformco said it would „continue to develop both the hometown stores and the home and life stores in towns and villages that previously had larger stores.“ He is also „very focused on growing sears.com and business of Sears Home Services.“ According to the bidder, Lampert`s ESL, which had also attempted to purchase the services business in the past, derailed several attempts Service.com reach an agreement to get Sears` services business out of bankruptcy. Eventually, an offer of a Service.com hunting horse was approved by the court – but it was never closed. Sears and Kmart aren`t the only retailers struggling with changing their shopping habits to large retailers like Walmart and Target and online retailers like Amazon. JCPenney and Neiman Marcus both filed for bankruptcy when the pandemic hit in 2020 and Lord & Taylor went bankrupt. And Sears stores dominated the retail landscape, forcing many local Main Street stores to close, just as large retailers would one day close department stores.
Many Sears have been the anchor of the malls that have contributed to the growth of American suburbs. It was literally a company that changed America. „He lets the leases expire, he leaves the shops. It keeps them open when it makes sense to stay open,“ said Mark Cohen, director of retail studies at Columbia University. „Obviously, they will all be gone shortly. You can count on that. Since its inception, Transformco has been a privately held company, which means that the window into Sears` finances and even basic operations is almost closed. The waves of store closures since the bankruptcy also raise a question: why did Lampert bother to buy the stores? Did he really believe there was a future for the retailer? No one but Lampert can know the answer. Your complaint against Lampert and others is filled with fiery language, even for an adversarial trial. They pointed to the splits of Lands` End and Seritage, accusing Lampert and other shareholders of „asset theft,“ „rank self-trading“ and „numerous other breaches of fiduciary duty.“ Part of the problem is Sears Holdings` mountain of bills since the Chapter 11 filing, which include legal, advisory and investment banking fees during the deal.
The company`s total professional fees amount to about $250 million, making it the most expensive retail bankruptcy case in the past five years and one of the most expensive bankruptcies in retail history, according to Debtwire data. Another disruptive factor is the size and complexity of Sears Holdings, with its many financial and entrepreneurial entanglements, a legacy of Lampert and the company`s heyday as a conglomerate spanning industries beyond retail. Jim Rice, senior vice president at Creditntell, said in an interview that the current footprints of Transformco sears and Kmart may not be enough to cover banner overhead. In addition, Sears and Kmart`s supplier base has likely shrunk along with their footprint. Rice said he has received fewer requests from those who want to sell to Sears since the bankruptcy. „I used to get a lot of calls from suppliers who wanted to ship,“ Rice said. „Those calls have really dried up.“ Transformco did not immediately respond to USA TODAY`s request for comment on how many stores would remain after the closures, information about liquidation sales and an official closure list. Today, there are only 21 full Sears stores left in the Americas and two more in Puerto Rico, according to the store locator on Sears` website, once the recent closures are resolved. Seven other stores listed on the site are limited to selling appliances and, in some cases, mattresses rather than the full range of offerings that were once a trademark of both chains. SB360 Capital Partners is handling the sale of the deal, according to the liquidation firm`s website, which contains a list of 33 deals.
Some stores on the list are already closed, including the Sears in Pasadena, Texas. Marlborough: Solomon Pond Mall, 521 Donald Lynch Blvd. (Added Feb. 19) Some stores have announced their impending demise on their Facebook pages. Lampert is a „mastermind of the company`s rulebook,“ according to Egelanian. „He always manipulated Sears to get the biggest gain for Sears owners or for the companies he founded to profit from Sears.“ Transformco has other assets in addition to kmart and Sears stores. In mid-2019, the company acquired Sears Hometown, which Sears Holdings separated from in 2012. Merritt Island: Merritt Square Mall, 777 East Merritt Island Causeway (Added to file on 1. February) CONNECTION: Walgreens will close these transactions permanently as of November 8. If this is the end, it would be a sad disappearance for two chains, both dating from the end of the 19th century.
North Attleboro: Emerald Square Mall, 1009 S Washington St. In a statement to USA Today in September, current parent company Transformco said its „future store strategy for Sears and Kmart is to operate a diversified portfolio consisting of a small number of world-class department stores with a larger number of small-scale stores.“ The company says this includes the hometown`s more than 300 stores, which are „operated primarily by independent dealers or franchisees of a Transformco subsidiary.“ COVID-19 Payment: Trader Joe`s Increases Pandemic Payment Nationwide, While Kroger Announces Store Closure Due to Risk Payments Brandon: 686 Brandon Town Center Mall, 686 Brandon Town Center Mall „It`s been in decline for some time in the finals,“ said Neil Saunders, managing director and retail analyst at research firm GlobalData.