1. News
October 22, 2018

Sears chairman in talks to raise $300m bankruptcy loan

US retailer Sears Holdings chairman Eddie Lampert is reportedly in talks with a partner in a move to raise $300m bankruptcy loan.

US retailer Sears Holdings chairman Eddie Lampert is reportedly in talks with a partner in a move to raise $300m bankruptcy loan.

People familiar with the matter were reported by Reuters as saying that ESL Investments, a hedge fund of Lampert, has held discussions with investment firm Cyrus Capital Partners on Lampert’s behalf.

Cyrus Capital currently holds some of Sears’ existing debt and the negotiations are part of the company’s efforts to invite potential partners to share in funding portions of $300m loan.

“Negotiations are part of the company’s efforts to invite potential partners to share in funding portions of $300m loan.”

This loan is separate from another $300m bankruptcy loan offer from the retailer’s banks including Bank of America, Wells Fargo and Citigroup.

In addition, Reuters has reported that Lampert received suggestions to replace the $300m loan from the banks with his own financing.

Lampert, who is the department store operator’s largest shareholder and creditor, created Sears in 2005 through a merger with Kmart.

The investments in Sears are said to have been carried out through his hedge fund.

Sears, along with its subsidiaries, filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the US Bankruptcy Court for the Southern District of New York earlier this month.

The court has also approved the retailer’s first day motions for its voluntary Chapter 11 restructuring last week.