On Monday, Sears Holdings Corp announced that it filed for Chapter 11 of the US Bankruptcy Code. Now, the future of the retailer with a century-old history, which was once-dominant retail chain in the United States, is in question. The giant, apparently, lost its position in the era of online stores.
Reorganization of the debt of Roebuck and Co and Kmart Corp, the parent company of Sears, was the result of prolonged revenue decline and closure of hundreds of stores, as well as deals made by the head of the company, billionaire Eddie Lampert, in attempt to improve the situation.
In documents sent to the court in New York, the company indicated assets of $6.9 billion and liabilities of $11.3 billion.
Another reason for the filing was the disagreement of Lampert, the largest shareholder and creditor of the company, and the board of directors’ special committee regarding the retailer rescue plan proposed by Lampert.
Shareholders tend to lose investment when a company files for bankruptcy, and the future of Sears will depend on the willingness of creditors and suppliers to keep the company afloat.
Friday’s closing price of Sears’ shares was about 41 cents, compared with $100 they had cost for several years after Lampert merged the company with Kmart.
