ESL Investments Completes Acquisition of Sears Holdings’ AssetsFebruary 11, 2019 10:56pm

BAY HARBOR ISLANDS, Fla.--(BUSINESS WIRE)--Feb 11, 2019--ESL Investments, Inc. (“ESL”) today announced that its affiliate, Transform Holdco LLC, has completed its acquisition of substantially all of the go-forward retail footprint and other assets and component businesses of Sears Holdings Corporation on a going-concern basis for a total consideration of approximately $5.2 billion.

The new Sears (the “Company”) will comprise 223 Sears and 202 Kmart stores, along with prominent brands and operating businesses, including Kenmore, DieHard, Craftsman, Sears Home Services, Sears Auto Centers and Innovel.

Edward S. Lampert, CEO of ESL, said, “The best possible outcome has now been realized for all stakeholders, including Sears’ many associates, Shop Your Way members, vendors and other partners. ESL looks forward to a new era at Sears and Kmart that builds on their proud histories, while finding new ways to innovate and grow to adapt to the forces transforming the retail industry. We are ready for this exciting opportunity to help return Sears to profitability and will apply ourselves every day in pursuit of that goal.”

The new Sears moves forward from the Chapter 11 process positioned for success with:

As of the closing of the acquisition, the new Sears had more than $400 million in excess availability on its new asset-backed credit facility, which provides a significant runway to pay assumed liabilities, execute go-forward initiatives, including investments in new, smaller stores to expand the Company’s reach in the hardline category, pursue renewed marketing efforts, foster new partnerships that unlock value and invest in the Company’s unique services and delivery offerings. The new Sears has a plan to be EBITDA positive in fiscal 2019.

Transform Holdco will ensure a seamless transition, with no disruption to the member and customer experience and continuation of Sears’ member programs, warranties and protection agreements. Vendors and suppliers will continue to be paid in the ordinary course for all goods and services under agreed upon terms.

The new Sears will be led by the management team that constituted the Office of the Chief Executive of Sears Holdings, consisting of Robert A. Riecker, Chief Financial Officer, Leena Munjal, Chief Digital Officer, and Greg Ladley, President, Softlines. The Company intends to conduct a search for a Chief Executive Officer with a record of success in managing platform businesses and effectuating large-scale dynamic transformations.

Cleary Gottlieb Steen & Hamilton LLP is serving as legal counsel, and Moelis & Company is serving as financial advisor to ESL Investments, Inc.

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Paul Holmes

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SOURCE: ESL Investments, Inc.

Copyright Business Wire 2019.

PUB: 02/11/2019 05:56 PM/DISC: 02/11/2019 05:56 PM

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