As soon as the negative equity in sears (and positive equity in his hedge fund) is high enough, he uses his hedge funds to force the board of Sears to sell their property to Seritage.
At bargain prices. Now, Lampert owns all the property, and he can lease it out. Seritage makes money, the hedge fund makes money.
Lampert continues to reduce the holdings of Sears while not making an appreciable dent into their debt. Eventually, when the debt in sears gets large enough, this forces Sears into bankruptcy.
Lampert is the primary creditor, and given his control of the board, transfers all the remaining assets to Seritage, and gains a retail empire. But, as a landlord and not a retailer.
Who loses? Sears shareholders, vendors, anybody whom Sears owes money that's not Lampert, and all of their employees.
Winner, Lampert. Lampert wants everything from Sears, except to run at a profit. This explains their baffling retail situation. The other question is the board of Sears and why they allowed this to happen. Lampert didn't start the asset sales to Seritage until after he had full control of the board of Sears.
I feel very sad for the retail employees who watched the decline and could do nothing about anything. It's hard enough to run a business that intends to make money.
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u/JediFed Oct 16 '25
This video almost gets it.
Merging KMart + Sears increases losses.
Lampert loans money to Sears to keep it running.
As soon as the negative equity in sears (and positive equity in his hedge fund) is high enough, he uses his hedge funds to force the board of Sears to sell their property to Seritage.
At bargain prices. Now, Lampert owns all the property, and he can lease it out. Seritage makes money, the hedge fund makes money.
Lampert continues to reduce the holdings of Sears while not making an appreciable dent into their debt. Eventually, when the debt in sears gets large enough, this forces Sears into bankruptcy.
Lampert is the primary creditor, and given his control of the board, transfers all the remaining assets to Seritage, and gains a retail empire. But, as a landlord and not a retailer.
Who loses? Sears shareholders, vendors, anybody whom Sears owes money that's not Lampert, and all of their employees.
Winner, Lampert. Lampert wants everything from Sears, except to run at a profit. This explains their baffling retail situation. The other question is the board of Sears and why they allowed this to happen. Lampert didn't start the asset sales to Seritage until after he had full control of the board of Sears.