Throwing good money after bad

[Shaun @ Tru6]

Exclusive: Sears snags new financial lifeline as losses continue - sources

"(Reuters) - U.S. department store operator Sears has reached a deal for a fresh financial lifeline totaling roughly $100 million from hedge fund Brigade Capital Management LP, as it tries to stabilize after bankruptcy, people familiar with the matter said on Thursday."

Why would anyone want to lose $100 million?

What plan could they possibly have to, forget about doubling that plus, but even ever getting it back?

[wdfifteen]

Probably just a tool to load with debt from other operations. I don’t think there is a real strategy to make Sears viable, the move is part of a bigger scheme.

[RWebb]

Originally Posted by Shaun @ Tru6

What plan could they possibly have to, forget about doubling that plus, but even ever getting it back?

They have a secret plan.

They are going to advertise heavily to farm families and will sell them almost anything - even knock down buildings.

It will all be delivered by rail.

[Bob Kontak]

Originally Posted by Shaun @ Tru6

What plan could they possibly have to, forget about doubling that plus, but even ever getting it back?

I was a college student in '82 when Chrysler stock had to be bundled in 100 share units for about a dollar a share.

Who knows.

However, Sears is so 1960's. I don't see it. I hope they have a plan.

[RKDinOKC]

Since they have gotten rid of the Craftsman name, who cares?

The smaller places that used Sears now have Walmart, Home Depot, and Lowes.

[LWJ]

I am not Wall Street savvy but that seems a losing bet.

Either some serious stupid?

Or, some underhanded shenanigans that I don't understand.

[pavulon]

The craftsman bungalows were/are iconic houses. I’d buy one today if I could.

Originally Posted by RWebb

They have a secret plan.

They are going to advertise heavily to farm families and will sell them almost anything - even knock down buildings.

It will all be delivered by rail.

[Noah930]

My local Sears apparently closed last weekend, and it was one that had shoppers and lines at the cashier. I've been to two or three others in the last few years that didn't even have shoppers.

[ckelly78z]

My local Sears was a ghost town 5 years ago, and out of business for 4. A skeleton crew just showing up to get another paycheck...there is no saving this chain, but possibly a tax shelter, or some other angle i'm not thinking of.

[rfuerst911sc]

I wonder if the ultimate goal is to convert all remaining Sears stores to something else ? Warehouse distribution centers for someone else ? Battery warehouse and changing stations for electric vehicles ? My opinion they are dead as a common retailer so their survival will have to be some kind of out of the box thinking/conversion .

[jwasbury]

If the new $100m is a secured by hard assets, and senior to other debts of Sears, then perhaps the lifeline investor is assuming a default and will assume ownership of assets. Perhaps they believe the value of hard assets pledged as security/collateral for the loan is >$100 so this is a way to “buy” those assets cheaply.

For sure the Sears brand is not worth much these days, but I’d expect there are still a lot of hard assets and real property within the company that have value.

[mocha07]

After March,there will be no Sears stores open around the metro Baltimore area!!!!!

[biosurfer1]

Anything that happens with Sears you see about it getting a lifeline, or doing something other than just closing up shop, is directly tied to the current CEO sucking every last dollar before finally ending things.

Just look at the history of him and his shell company that now owns most of the land and stores and is paid rent by the stores that are left. It's in his best interest to keep the life support on as long as possible at the detriment of anyone left stupid enough to invest.

[wdfifteen]

Originally Posted by rfuerst911sc

I wonder if the ultimate goal is to convert all remaining Sears stores to something else ?

Yes, cash into the pockets of the hedge fund owners. They have no intention of making Sears a viable retail operation.

[fastfredracing]

What a great place to work back in the 90's. They loved me, I set my own schedule , and made decent money . There was rarely a day that I would come in , where there were not customers lined up out the doors waiting for service.
I almost took a full time position there a few times. The full timers there, made good money, and had a pretty gravy job as far as auto mechanics go .
I kept that job part time , for years , sometimes only working one evening a week, just to keep my foot in the door . It helped me to get my biz open . I kept it about 6 months into self employment, and finally let go of the safety net .
Sometimes, I made more money there part time, than I did at my full time Dealer job .
My dad just had a pacemaker put in back in November . I ran into one of the Sears lifers, who was now parking cars at the hospital . He rode it right up till the end, even helping close several stores in other areas .
Id like to see them come back, but I am afraid that they lost their few strongholds in the market .

[widebody911]

https://theweek.com/articles/801927/how-vulture-capitalists-ate-sears

[sugarwood]

Originally Posted by Shaun @ Tru6

[

Why would anyone want to lose $100 million?

What plan could they possibly have to, forget about doubling that plus, but even ever getting it back?

Their plan is to get it back, plus interest.
Or repo the collateral.

[Jim Richards]

Originally Posted by rfuerst911sc

I wonder if the ultimate goal is to convert all remaining Sears stores to something else ? Warehouse distribution centers for someone else ? Battery warehouse and changing stations for electric vehicles ? My opinion they are dead as a common retailer so their survival will have to be some kind of out of the box thinking/conversion .

I wonder if Sears actually owns their property, or is it leased?

[GH85Carrera]

Most all of us remember the days when Sears was king. I can remember spending hours in the tool department drooling on stuff I "need" or wanted. Now I can go to Harbor Freight at look at crappy China made tools that may do the job, but it sure is not the good stuff. The big box hardware stores have a decent selection and even Craftsman tools, but they are not the great lifetime tools I remember and once again are Chinese made.

As a guy there is almost nothing else Sears sold that I wanted. I did buy a Diehard battery once and some automotive stuff.

[Noah930]

Originally Posted by Jim Richards

I wonder if Sears actually owns their property, or is it leased?

Apparently Sears owns (or has owned) a lot of its properties. (I don't know if that's true at mega-malls though, where the Sears may be one of the anchor stores.) So one thing the owner, Eddie Lampert, of Sears has been doing is selling the property to his holding company, which then leases the buildings back to Sears (the retail store). Or closing Sears stores and re-leasing them to other retailers. I guess Lampert figures the real estate is more valuable than the retail business.