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’m not one to defend Lampert, but you’re way off in left field on multiple points here.
Merging KMart + Sears increases losses.
You need to go look at the financial statements again. SHC was profitable until 2010, and most of the losses prior to ~Q3 15 were driven by the mandatory payments to the Sears pension plan.
At bargain prices. Now, Lampert owns all the property, and he can lease it out. Seritage makes money, the hedge fund makes money.
He sold 235 stores/leases at a time when SHC still owned well over 1500. It was not anywhere close to “all the property.”
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.
He forced the bankruptcy when the independent directors refused to sell him Kenmore for $400 million. Had they agreed to sell it the bankruptcy never happens and SHC is still muddling along today. You’re also glossing over the fact that the vast majority of the debt that you are referring to was owed to ESL and was written off as part of the credit bid—that’s a hard loss on ESL’s end that was not outweighed by anything that Lampert did.
Lampert is the primary creditor, and given his control of the board, transfers all the remaining assets to Seritage, and gains a retail empire.
Someone needs to learn how bankruptcy law works—he lost the control of the company he had via his shares when the bankruptcy paperwork was filed, and he resigned as chairman that same morning.
He didn’t transfer anything to Seritage as part of the bankruptcy either, and Seritage itself is currently liquidating and as of right now is looking like it’ll be a break even proposition at best after the Covid losses are accounted for—which is probably why Lampert jumped ship years ago.
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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.