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  • April 2019 (Revised December 2021)
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Sears: The Demise of an American Icon

By: Kristin Mugford and Sarah L. Abbott
  • Format:Print
  • | Language:English
  • | Pages:40
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Abstract

In 2019, ESL Investments’ $5.2 billion offer to purchase Sears Holdings out of Chapter 11 bankruptcy, was accepted, despite opposition from the company's unsecured creditors and other parties. ESL, which was led by Eddie Lampert, had acquired a stake in Sears following its 2005 merger with Kmart. Lampert was chairman and CEO. During Lampert’s ownership, Sears and Kmart shrunk their store base from 5,670 to 687 stores, and over 200,000 employees lost their jobs. Some attributed Sears’ woes to a challenging operating environment, others argued that Lampert's actions over the last decade benefitted himself and other shareholders at the expense of other Sears stakeholders. Was a sale of the company to ESL the best outcome?

Keywords

Bankruptcy; Reorganization; Bonds; Restructuring; Business Divisions; Transformation; Fairness; Borrowing and Debt; Credit; Insolvency and Bankruptcy; Corporate Governance; Motivation and Incentives; Retail Industry; United States

Citation

Mugford, Kristin, and Sarah L. Abbott. "Sears: The Demise of an American Icon." Harvard Business School Case 219-106, April 2019. (Revised December 2021.)
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About The Author

Kristin W. Mugford

Finance
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Related Work

    • April 2019 (Revised December 2021)
    • Faculty Research

    Sears: The Demise of an American Icon

    By: Kristin Mugford and Sarah L. Abbott
Related Work
  • Sears: The Demise of an American Icon By: Kristin Mugford and Sarah L. Abbott
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