WSJ: "Sears Hires Advisers to Prepare Bankruptcy Filing" - & maybe liquidation!

I posted this September 29th -  Times change - Sears is now a penny stock   And now it's come to this (I expect they'll continue to operate while in bankruptcy) - UPDATE: But maybe not stay open! A group of lenders, including Bank of America, Wells Fargo and Citigroup, are pushing for the company to liquidate its assets under a chapter 7 bankruptcy filing, as opposed to reorganizing the business under chapter 11

Troubled retailer working with boutique firm M-III Partners and could file for court protection ahead of Monday debt payment

Employees at M-III Partners, a boutique advisory firm, have spent the past few weeks working on the potential filing, the people said. In recent days, M-III staff have been at the retailer’s headquarters in Hoffman Estates, Ill., one person said. Sears continues to discuss other options and could still avert an in-court restructuring, the people added.

Sears, which has been losing money for years, has $134 million in debt due on Monday. Edward Lampert, the hedge-fund manager who is Sears’s chairman, chief executive, largest shareholder and biggest creditor, could rescue the company, as he has done in the past by making the payment.

But Mr. Lampert is pushing for a broader restructuring that would include shaving more than $1 billion from Sears’s $5.5 billion debt load, selling another $1.5 billion of real estate and divesting $1.75 billion of assets, including the Kenmore appliance brand, which he has offered $400 million to buy himself.

The company’s poor financial performance has made it difficult to get support from lenders for the plan, one of the people said. Mr. Lampert hopes to shrink Sears back to profitability, this person said. The company has already closed hundreds of stores in recent years.

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Sears has more than $11 billion in cumulative losses since 2011, and its annual sales have dropped nearly 60% in that period to $16.7 billion. Analysts say it needs to raise more than $1 billion a year to stay afloat. 

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Once hailed as a genius investor for smart bets he made on AutoZone and AutoNation , Mr. Lampert met his match in Sears, Roebuck & Co. The retailer was struggling before he combined it with Kmart, which he rescued from bankruptcy, to create Sears Holdings Corp. in 2005.

Sears has been called "The Amazon of the 20th Century". Trouble is, it's the 21st century.