Thread regarding Sears layoffs

The hedge fund owners or the people who run them do not own the stock the hedge fund clients do. So Bruce in his hedge fund owns nothing it is his investors that are taking the risk. Hedge funds make a profit from the fees they charge the clients. If the clients decide that it is a bad investment then the game is up.

Same with Eddie. While he and Bruce both own some personal stock most in from their hedge funds.

Also, the loans Eddie gives to the company are backed by the assets of the company and interest on the loans.

So never think that just because someone has a lot invested that you should follow. They have a way of making money, win or lose no matter what, that you don't have the capital to be a part of.

But on the flip side, everyone knows that Eddie and the boys are hurting so why would they buy any of the assets when they can wait and get them at fire sale prices. It is a nice poker game they are playing with other peoples money.

Don't know about that. the second biggest stockholder is Bruce Berkowitz, another hedge fund investor. He currently owns close to 300 million worth of stock, or about 25% of the company. Yet, he is also one of the people who loaned Sears Holdings money. He currently owns about 900 million of debt. I don't know too many investors that would loan a company 900 million to protect a 300 million investment. Sounds like he thinks there is some upside to Sears Holdings eventual death.

125 properties are already pledged to pay down part of the pension benefit, if Sears goes into bankruptcy, or for other reasons, including pension termination. So that leaves a smaller pool of owned stores of varying worth as an option to sell to Seritage.

Innovel will take months to a year or more to sell, so it's not terribly liquid. They can also go to Eddie for more cash, but that well will eventually dry up. His hedge fund is worth a fraction of what it was just a few years ago, and it has to be under a lot of strain.

There's really not a lot left outside of that.

it is, but thats what they will do to keep the lights on for a few more months- at least eddie and the boys will be able to walk away with the real estate if they move the rest of the properties to seritage- if they give up now those properties will go to pay off the debt and fund the pension deficit and i am sure eddie doesnt want to do that.

At this point selling off assets is an exercise in futility.

They can raise liquidity quite easily- sell off the remaining real estate to seritage, sell innovel solutions and Eddie can lend against a proportion of the inventory- that would raise about $4.5 billion. The trouble is those are all that's left to monetise and the business losses will eat up that much in 2 years.