Thread regarding Sears layoffs

2hwq- IF someone buys the company or if Eddie and Bruce take it private they would also have to take on the debt. So who would want to take on a company which has ruined its reputation, has massive amounts of debt and legal problems, is closing stores and all the valuable properties have been transferred to another company or are ring fenced by the government to cover the pension?

The shell game is over, that is why Bruce left and closed down his fund. There is no transformation, there is no hidden value. Bruce also said that Sears Canada had massive value but they have shuttered the doors and are liquidating the company.

An interesting viewpoint from Seeking Alpha on why Bruce stepped down. It starts with a quote from Bruce and then their opinion follows.

"You will not be surprised to hear that the assets of Sears Holdings have enormous value, and that remains my view today. As the company continues to progress in executing its strategic restructuring program, I believe that I can now be of more value from outside and have therefore elected to step down from the Board at the end of this month."

There is, of course, a lot of speculation about what he is implying by stating "more value from the outside". According to 5/31/17 filings, his funds own close to $190 million in Sears debt (using information from the Bloomberg Terminal). That amount of debt could get him a seat on either the official or ad hoc creditors committee under a Ch.11 bankruptcy filing. If he was a director he would normally not set on a creditors committee. This could give him personally more input into the bankruptcy process than as a director.

@2hwq I just don't see who would want to deal with this huge mess. It would have to be some rich millionaire hell billionaire to wanting to invest heavily redesign the whole stores (or some stores). Also another key point Bruce was wealthy yet he basically called it quits so this would most likely scare other rich investors that wouldn't want to take a gamble in a dying company.

@2lyz just don't see a master plan at this point the guy tried he probably saw how bad things were and just called it quits.

I think there is something brewing. The stock is super cheap. This is an easy time for someone to swoop in and buy us and take us private. I am not saying I don't think there will be more store closures as I think there will be, but I don't think it's quite as gloom for the total company as some are making it out to be.

I agree with @2iyf I don't think there is a master plan made between Bruce B. and Eddie L. Bruce gave up and wanted to get out before things get worse because they are not going to get better. I don't think this even means the stores but the so called value packed real estate might not be as great as he thought either. The stores are hopeless and I work in one of them.

@2zta I think thats what Eddie wants in the end of the day focus on just rental properties he never seen to show interest (maybe in the start) to revive the company since everything is going collateral when the company goes bankrupt and he keeps the properties. At this point if anything can work well is shrinking the stores (closing a bunch) and selling just appliances and just tools, but not in all areas would that work since their is competition.

I honestly don't think their is a plan here I think Bruce saw that things werent getting any better (the most recent news Sears Canada bankruptcy and than Eddie loan another $100 million) it just tells you that their is no turning around this company at this point. Maybe he also doesn't want to deal with any legal issues because I am sure their is going to be some when it finally goes under and Eddie will most likely go into investigation course the guy probably has his bunch of lawyers ready to defend him.

Going private? Ok. Maybe. At what point does it make sense just to shut every Sears & KMart down & focus on selling & renting the real estate? Looks like that is the direction anyway.

Okay so going private isn't the end of the world for anyone. It could be a good move.

Bruce only left the bird so he could go on the Board of Creditors after the bankruptcy (he holds notes to sears). That way he will have more control. If he was on the BOD he couldn’t then be on the BOC. Smart move by him and Eddie.

Chapter 11, then go private.

Touché

So Bruce and Eddie could buy up the remaining shares now and take the company private.

(One more thing I meant to mention in my last comment: RBS Partners is a subsidiary of Eddie Lampert's ESL Investments, Inc.)

1jrv - The good news is, Sears (SHLD) got kicked out of the S&P 500 more than 5 years ago: http://www.cnbc.com/id/48837205

So a lot fewer funds/investors are still holding onto it than otherwise would be.

https://finance.yahoo.com/quote/shld/holders?ltr=1 shows who holds noteworthy amounts of Sears stock... the biggest investor after Eddie himself had been the Fairholme hedge fund run by Bruce Berkowitz, which announced yesterday (October 16, 2017) that it is liquidating (not just its Sears shares, it's shutting down entirely): https://www.bloomberg.com/news/articles/2017-10-16/berkowitz-liquidates-hedge-fund-that-owned-sears-holdings-shares . The next-largest shareholder is the RBS Partners hedge fund. Everybody else just has tiny amounts of Sears stock, which is hopefully also a tiny amount of each of them's overall investments (so the eventual bankruptcy won't do much damage to mainstream investors).

Sometimes smart people act stupid especially when ego is involved. Not every risk pans out even for the savvy. Sometimes you need to walk away.

Keeping a soft landing for yourself is good but if you haven't risked what you need to actually survive, you can stand to lose it. Neither one of these guys is going to be poor regardless. Playing with minimum wage workers lives is not nice but it's the capitalist corporate way.

So how many mutual funds and other places is this stock tucked into that nobody realizes yet?

I truly think there is something here we just don't understand. These guys are super smart. What if this is all part of the plan?

He's liquidating the hedge fund that holds Sears.

He and his various companies have held Sears stock since at least 2013. I found his letter to shareholders date 1-29-14 about the 2013 Fairholme annual report. He was predicting that Sears share value of $38 was going to increase over time. The good old days.

I'm guessing that he thought that he & Eddie could make the transformation work at least on the real estate end. Bruce said Sears is a real estate sheep in retail clothing. It is significant that even he is walking away. Of course he is not going to bad mouth his friend but statements like wishing the associates the best should scare the bejeezus out of those of us who are still associates.

Fun fact. Sears stock was $191.93 a share in April 2007.

No one thinks they know more than Bruce.....but Bruce was only on the board from 2016 until now the end of October. Did he have a stake in Sears before then? I don't know without looking it up, but I am guessing yes. So lots of assumptions are being made here.

Anyone who continues to believe in SHC is saying that they know more than Bruce. Do you think that is a rational position?

IMO Bruce left because he finally gave up believing in SHC.

He thought he could positively influence the Corp direction while on the board but things continued to decline. Now he is trying to avoid putting more good money after bad and saving what money he can on this failed venture.

He was Eddie's biggest big name in the finance world supporter and he knows this so he thought carefully about publicly withdrawing support because he knew what that would tell the world.

The company is done.

now is the big questions, what will Eddie do now, is it time to actually pull the plug on the whole operation ... did Bruce jump ship because he knows there will be lawsuits against Eddie and how sears has done things, as in the liquidations and the properties involved with the loans Eddie has given sears. I believe Bruce knew what has gone on and is now leaving before he gets roped into court with all the things that have been going on within the company

Ouch man one of the big top investor it pretty much tells you Sears is done and people are jumping out of the sinking ship.

Eddie just lost his best friend.

not a good sign at all people

you can short stocks below 5 dollars

The fat lady is singing. It'll be better if we have a restructuring rather than this slow bleed. There's no way we can survive without some sort of restructuring.

Well, that's going to f--- up the stock now, isn't it?

... and the stock is tanking. Good news is u can’t short a stock below $5.

Any ideas what the game is here?