Sears Again?? Euthanasia Please!!!

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\"rr_sears-again_euthanasia-please\"I really thought I was done with beating on Eddie “Take the Money and Run” Lampert when I last wrote about his sinking ship, “Sears Titanic: SOS” on February 5, 2016. But no such luck. It’s worse than watching the energizer bunny run around insanely over and over and over again. Here comes Eddie, again. Oh no!!! I envision finding an illustration of him in a captain’s outfit, selling the last deck chair while jumping into a lifeboat. The last deck chair is a metaphor, of course, for selling off Sears’ assets. He still has some of those assets, but not enough to keep the retail operation going for much longer. And when major vendors stop shipping goods, as they already have, you know the end must be near.

But Eddie “abracadabra” Lampert still wants us to believe he’s in control of transforming the business and righting the ship. How preposterously stupid can he think we are? Q3, 2016 marks the 20th consecutive quarterly revenue decline, to say nothing of consistently diminished foot traffic (are these buildings doubling as echo chambers?). The dumb duo of Sears and Kmart declined 13 percent year over year, worse than Q2’s 9 percent drop.

And what happened to what was supposed to be the magical lifesaver: e-commerce? Well, Eddie “now you see it, now you don’t” Lampert decided not to report online growth rates since Q3 2014, when he reported 18 percent YoY. You might be wondering why? None of us are that stupid. “Abracadabra” Eddie thinks he can somehow make the numbers disappear without us realizing it.

So, not even his online magic is working.


So, that will be another deck chair that won’t make it off the ship. My good friend, colleague and contributor to The Robin Report, Mark Cohen, who is Director of Retail Studies at Columbia University’s Graduate School of Business, had this to say about the sinking Titanic: “Lampert can\’t make it through 2017 without another substantial cash infusion. So he may do another big real estate deal and/or he might find a buyer for KCD (the securitized Kenmore, Craftsman and Die-Hard brands). He\’s not going to have any vendor support without putting cash and cash capacity on the company\’s balance sheet in 2017.

Most retailers who file C11 do it in January when their cash receipts from sales are at peak along with their accounts payable balances. There is some opinion (not unanimous among legal experts) that he can \’t file until July 2017 or face a fraudulent conveyance charge stemming from having sold off a large group of stores into the REIT that he created (Seritage) and that he controls. So…my guess is January or July 2017 is belly up time, absent some kind of divine intervention.

Don\’t cry for him — he\’s SHLD\’s principal creditor, so in a C 11 scenario, he remains in control and becomes principal shareholder of its new equity when it comes out of C 11. Then he gets to continue his mission of wringing the vestiges out of this monstrosity until there really is nothing left.

All I can say is the “Shop Your Way” folks will definitely shop their way. It just won’t be at Sears.



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