Feb. 7 (UPI) — A federal bankruptcy court judge approved the sale of most of Sears’ assets to a hedge fund controlled by its chairman, Eddie Lampert, on Thursday.
U.S. Bankruptcy Court Judge Robert Drain approved the sale of Sears Holdings to Lampert’s ESL Investments hedge fund for $5.2 billion to keep 425 stores open and preserve the jobs of 45,000 employees.
Had Drain, a judge in the Southern District of New York, not approved the sale, the U.S. retailer likely would have been liquidated.
“The execution risk for this transaction, when one considers the alternative … is reasonable to take,” Drain said, according to USA Today.
Drain’s ruling went against creditors owed more than $3 billion by Sears. Those creditors called on the court to shut down the company and liquidate its assets, saying that would be the best way to repay their debts.
Creditors added the circumstances surrounding the sale were unfair, as it only permitted Lampert, the company’s former CEO, to purchase the company.
Despite the successful sale, additional stores may close.
“We intend for the new company to operate as many Sears and Kmart stores as reasonably possible, including new smaller stores that emphasize our stronger capabilities. Continuing to operate a meaningful network of stores is essential to achieving our goal of returning Sears to profitability,” ESL Investments said earlier this week.
