Sears, the Amazon of the 1930’s, has been in trouble for decades and its woes seem to have hit a crescendo as a hedge fund announced its intention to buy Sears’ company brand of appliances.
Craftsman used to be Sears’ company brand of tools and lawn implements before it was acquired by Stanley Black & Decker in March 2017. The sale happened as Sears began selling off brands and real estate to slow its death spiral. Now the former department store behemoth may sell off its highly-visible appliance brand and the news sent shares of their stock to a new low.
Sears Holdings (NASDAQ: SHLD) shares slid 13% to an intraday low of $1.27 before ending the day at $1.32. The slide came after a hedge fund, ESL Investments, owned by CEO Eddie Lampert offered to buy the troubled retailer’s Kenmore appliance division for $400 million.
ESL said that it will need to acquire additional funding to make the purchase, but that it is confident that it can secure a financing deal.
“We are prepared to move as quickly as possible to complete these transactions, which is in the best interest of all parties involved,” a spokesman for ESL told CNBC.
Sears has been shedding assets over the years to come up with cash to keep the company afloat. While it’s sales are deteriorating, the retailer is still testing new concepts like stand-alone mattress stores and combined Sears and Kmart locations. Kmart and Mattress Firm, a company specializing in stand-alone mattress stores, have both had their own struggles. And Sears wanting to join or copy those models is not building confidence in investors.