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Facing liquidation, Sears to close 80 more stores, disappointing some in West Michigan

In this Nov. 2, 2018 photo, a sign in the window at Sears promises that "This isn't goodbye," at the Livingston Mall in Livingston, N.J. Sears is closing 80 more stores as it teeters on the brink of liquidation. The 130-year old retailer set a deadline of Friday, Dec. 28, 2018 for bids for its remaining stores to avert closing down completely. (AP Photo/Ted Shaffrey)

Sears is closing 80 more stores as it teeters on the brink of liquidation.

The iconic retailer, once the nation's largest department store chain, set a deadline of Friday for bids for its remaining stores to avert closing down completely.

Among the stores expected to close are locations on Harvey Street in Muskegon and one in Novi, Michigan. As that deadline neared, customers at the Sears store in Portage told Newschannel 3 they'd hate to see the company go.

"We've grown up with Sears, bought many different things at Sears," said customer Dave Hojnacki." However, Amazon has been putting a lot of people out of business."

Among the offers the company did receive is from Eddie Lampert, the hedge fund manager who is Sears' chairman and biggest shareholder. Lampert, who founded ESL Holdings, owns just under half of the Hoffman Estates, Illinois, company, according to FactSet.

Now, Lampert and his hedge fund are offering to buy the rest of Sears for up to $4.6 billion in cash and stock in a move to stave off liquidation.

The retailer that began as a mail order catalog in the 1880s has been in a slow death spiral, hobbled by the Great Recession and then overwhelmed by rivals both down the street and across the internet. In October, weighed down by years of declining sales and massive debt, Sears filed for Chapter 11 bankruptcy protection. The company then said it would shutter 142 unprofitable stores in the hopes that it could stay in business.

As recently as 2012, Sears Holding Co. operated 4,000 Sears and Kmart stores. Including the closings after the bankruptcy filing, Sears would have just over 500 functioning locations left.

In a regulatory filing Thursday, ESL Holdings said its nonbinding offer for the roughly 500 remaining Sears stores would keep about 50,000 employees working. The offer is subject to due diligence and ESL's ability to get financing, among other things.

"ESL believes that a future for Sears as a going concern is the only way to preserve tens of thousands of jobs and bring continued economic benefits to the many communities across the United States that are touched by Sears and Kmart stores," the firm said in a prepared statement.

The ESL Holdings bid follows a series of moves Lampert has offered to salvage the company over the past few years. The offer comes as the company's lacking support from many vendors who have been reluctant to work with Sears in fear of not getting paid.

"I think he has a plan whether it will be evident or not to us," said David Tawil, president and co-founder of Maglan Capital, which follows distressed companies. "Whether that plan will be successful, I don't know."

Robin Lewis, a New York-based retail consultant, questioned whether Lampert is honestly trying to save the business and bring it out of bankruptcy.

"If he is successful in doing so, the first person he should fire is himself," Lewis said. "He will continue to destroy it and it will be right where it was."

The 80 stores are due to close by March. That's in addition to 182 stores already slated for closure, including 142 by the end of 2018 and 40 by February.

Under Lampert, Sears bought time by spinning off stores and putting on the block the brands that had grown synonymous with the company, such as Craftsman. Lampert loaned out his own money and put together deals to keep the company afloat and to turn whatever profit he could for the ESL hedge fund.


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