Parent company of Sears, Kmart prepares for possible liquidation

New York City. If the bankrupt retail chain does not accept the only bid to save it it could be forced to start the process of shutting down as soon

New York City. If the bankrupt retail chain does not accept the only bid to save it it could be forced to start the process of shutting down as soon

If Sears doesn't accept Lampert's bid, it's likely the retailer will face liquidation and begin the shutting down process very soon.

Sears on Tuesday had planned to tell the bankruptcy court it had rejected Lampert's $4.4 billion offer to buy the retailer, after it fell short of covering its bankruptcy expenses. Sears filed for bankruptcy in October. Eastern on January 9. Now Sears faces full liquidation of its assets if the judge doesn't decide to give Lampert more time to improve his offer, which Reuters' sources say he and his hedge fund, ESL Investments Inc., are attempting to do. As many as 50,000 jobs are at stake. Were Sears to liquidate its assets, it would become one of the most high-profile victims in the wave of bankruptcies that has swept the retail sector in the last few years, as the explosion in online shopping exacerbates the fierce price competition facing brick-and-mortar stores.

That bid had included $1.3bn (£1bn) in financing from three institutions, ESL said in a statement.

In addition, Lampert wanted a release from legal exposure related to a series of transactions he completed with the retailer before it filed for bankruptcy protection. Lampert is the largest shareholder in Seritage.

Amazon becomes most valuable company, moving past Microsoft
Shares of Microsoft, which claimed the title of the world's most valuable stock in November , rose 0.1 per cent on Monday. Shares of the e-commerce company rose 3.4 percent, a rally that gave it a market capitalization of $797 billion.

Lampert's offer did not include putting up cash to back the credit bid.

About $17.9 million of the $120 million deposit is nonrefundable and will cover the cost of delaying the company's liquidation if ESL doesn't emerge as the winning bidder, Schrock said. The creditors' attorneys question whether the terms of those loans unduly benefited Lampert and his hedge fund rather than Sears.

A court hearing is scheduled for today (Jan. 8). Even as Sears' brick and mortar competitors established effective e-commerce operations Sears - a pioneer in catalog sales - failed to do so.

Even though no other bidders stepped forward, Sears Holdings' board decided the offer wasn't good enough since almost a quarter of it was in the form of debt forgiveness. The company responded by closing unprofitable stores.

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