Will there be no more Sears or Kmart after the liquidation is finalized?
10 replies (most recent on top)
Sears: Where America USED to shop, 30 years ago! Most people aren't even aware there are any Kmart or Sears stores left.
Sears will be in Mexico and Kmart will be in Australia, both with great success and likely for decades to come. The reason for this is that they have nothing to do with Eddie Lampert
Sears used to be where America shopped. Now it's a place for "urban explorers" to cruise through dead buildings. I got a laugh from a video one of them posted online. First, he showed the empty parking lot, and the old decaying signage for the Sears store. He walked up to the door, pulled on it and said, "Wow this place is still open!"
You guys are getting this wrong. As of today, we have a considerable task to reinvigorate and disrupt retail with our brands. Everyone knows that Sears is where America shops.
@1cfd 👍
The previous comment is correct in many respects concerning the tax losses, but some details are off. Sears Holdings does not exist any longer as any sort of entity, paper or otherwise. What's left is a liquidating trust, which will distribute remaining assets to creditors. The company was liquidated as part of the bankruptcy plan, effective the end of last month. Therefore, there will be no merger with Sears Holdings to utilize the tax losses. Transformco got the tax losses as part of the deal when buying the stores and other assets from Sears.
Just to make it clear because some Sears Holdings shareholders continue to think they are going to get a big payoff out of this deal from a merger. Some even believe there is going to be a big revival of stores. It's not going to happen. Transformco cannot merge with a non-existent company. Of course, Transformco is falling apart and eventually there will be no more Sears or Kmart stores.
What this means is that Sears Holdings will most likely exist as an on-paper entity. What is valuable here, if they remain unexpired, are potentially billions in net operating losses from Sears Holdings that could be used for tax write offs. This is probably the only reason why the Sears Holdings' bankruptcy limped along for 4 years. Sears Holdings, with its net operating losses, could then be merged with Transformco, allowing both to limp along for more time. Net operating losses exist while a company in in bankruptcy, and are non-negotiable in bankruptcy. It appears that just like Sears was always a "real estate play," it has now been reduced to a "play the federal bankruptcy code against the federal tax law play." You can be sure that like everything else only the lawyers who can find these complex loopholes get rich in the end. I'd look for similar "unlocking the value [of the federal tax and bankruptcy law]" at Seritage."
ESL own 29% of Seritage
real estate only- liquidating soon
ESL owns 100% of Transformco - Sears Home Services, Sears and Kmart stores (Except franchised Hometown stores)
- the longest ongoing liquidation in American business history
You're getting this wrong
Or am I getting this wrong?