Because there’s not enough money coming from anywhere else.

The hollowed-out husk that once was Sears does not have enough money to exit bankruptcy and finally, at long last, liquidate and die. In fact, it might be more than $100 million short of the cash it needs to pay off its creditors. No matter. U.S. Bankruptcy Judge Robert Drain is as sick of this crap as the rest of us, and at least some of Sears’ creditors.

Judge Robert Drain of the U.S. Bankruptcy Court in White Plains, N.Y., said he would sign off on a creditor repayment plan despite the company’s admission that it doesn’t have the cash to pay essential bills, including tens of millions of dollars owed to companies that supplied goods while Sears tried to stay afloat earlier this year….

Acknowledging the company’s dire financial straits, official committees representing Sears creditors and retirees agreed to support the bankruptcy plan, as did the Pension Benefit Guaranty Corp., a quasigovernmental agency that absorbed unpaid pension obligations…. Investment funds that bought Sears claims at discounted prices also agreed to support the plan, which allows them to get 75% of what they are owed quickly, as long as they sign away the rest.

Unsecured creditors are less lucky, in that they’re in line to get just 2.5 cents on the dollar, and that’s under a fully-funded liquidation plan which, as Drain noted even as he approved it, is all but impossible. All but, however: There’s still one unquantifiable Hail Mary that could yet pay off, but probably one, specifically suing the pants off the guy who got them here.

Another source of recovery for Sears’s unsecured creditors is a lawsuit funded with $25 million against Mr. Lampert, his hedge fund ESL Investments Inc. and others for deals that allegedly drained billions of dollars of assets from Sears…. The new company running hundreds of stores salvaged by Mr. Lampert is already closing locations and liquidating inventory, while it fights the bankruptcy estate over the terms of their agreement.

Sears Wins Liquidation Plan Approval as Lengthy Bankruptcy Nears End [WSJ]

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