Fewer stores, more money.

Some legendary retailers destroyed by hedge fund manager owners are allowed to finally die, sold for scrap, their inventories liquidated at marginally discounted prices. And then there is Sears. For more than a decade, it has been in a spiraling, mutually self-destructive relationship with its owner and former CEO, Eddie Lampert, although it must be said that most of the destruction has been on the Sears end of things. And for some time now, it’s been pretty clear to everyone except Eddie Lampert that this is a lost cause. Still, Lampert clings, and clings, and clings, keeping her on life support, providing the occasional infusion of life-giving money and sawing off the gangrenous parts as they appear, either for love or because he’s managed to financially engineer this patently disastrous situation into something he’s still making money on.

But here’s the funny thing about running a shrinking, undead retail chain: The smaller it gets, the most expensive it becomes to keep afloat. $100 million here, $1 billion there, $300 million to go from 700 stores to 500, $5.2 billion to get it down to 425 and beyond, and now, another quarter-billion to make another 100 go away.

Sears told Reuters on Thursday it had won a $250 million lifeline from lenders that include billionaire owner Eddie Lampert, and will close additional stores, as mounting losses strain the beleaguered U.S. department store chain’s finances….

Starting in December, Sears will close 96 stores, leaving the retailer with 182 locations, the company said in a statement. That is down from 425 stores Lampert acquired when he rescued Sears from bankruptcy proceedings in a $5.2 billion deal earlier this year…. Sears also owns Kmart discount stores, 45 of which will shutter during the December closings, one of the people said.

Merry Christmas!

Sears says it has secured a $250 million lifeline, will close 96 stores [Reuters]
Barneys Is Sold for Scrap, Ending an Era [NYT]

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