Copy. Paste. Repeat.
You know the story by now. Sears Holdings’ CEO Edward Lampert is pouring more money into the flagging Sears and Kmart chains.
This time, he’s lending $100 million through his hedge fund, ESL Investments, with the possibility of another $100 million. The loans are intended to help the chains make it through the critical holiday season.
The retail company has already blown through the $500 million line of credit it secured in December but since it was able to repay more than $100 million from real estate sales, the funds are available now.
The second sum will only become available if Sears can offer up more real estate as collateral.
The new loans will be due April 2018 and will be provided at 11 percent interest. The initial loan amounts are due in July 2020 at an 8 percent rate.
Liquidity heading into the holiday season is believed to be the main factor that forced Toys R Us into bankruptcy. The toy chain had been receiving resistance from vendors who were only willing to supply goods with an increasing number of fail safes in place. Sears is reportedly experiencing a similar pullback, as suppliers shy away. Others, however, have rushed in to fill the void—though they’re said to be keeping the retailer on a shorter leash.
[Read more about Toys R Us’ precarious position: Toys R Us Makes a Play for Survival With Bankruptcy Filing]
As the slew of bankruptcies have plagued the apparel retail space this year, Sears has appeared on many “next to go” lists—and without its Daddy Warbucks, it probably would have gone by now.
Though it was, in its day, all things to everybody, the retailer has lost relevance in a fast fashion, Amazon-led world. In its bid to hang on, it’s even selling off valuable brand names like Craftsman tools.
Meanwhile, Sears Canada, which Lampert sold off in 2013, is in even more dire straits. The chain is facing possible liquidation following a June bankruptcy filing.