Eddie Lampert sweetens bid to keep Sears open to more than $5 billion

Signage is displayed outside of a Sears Holdings Corp. store in San Bruno, California.David Paul Morris/Bloomberg

Eddie Lampert’s ESL Investments is sweetening its offer to keep Sears Holdings Corp. in business, outlining a US$5-billion plan to buy the retailer out of bankruptcy.

The new bid, about US$600 million more than Lampert previously offered, should satisfy conditions set in U.S. bankruptcy court on Tuesday after his earlier plan was rejected, ESL said Thursday in a filing. The terms include up to US$166 million to cover payments to suppliers, up to US$139 million of bankruptcy-related expenses and as much as US$43 million of additional employee severance. ESL said it also wants to acquire assets that weren’t in the original proposal.

Sears teetered on the edge of a shutdown after ESL’s initial bid was rejected over the weekend, prompting the company to begin preparations for a liquidation. But after three hours of negotiations Tuesday in a courthouse White Plains, New York, courthouse, the company agreed to give Lampert’s hedge fund another shot.