Sears Adds Restructuring Veteran to Board as It Faces Debt Payments
Sears Adds Restructuring Veteran to Board as It Faces Debt Payments
(Bloomberg) -- Sears Holdings Inc. added restructuring expert Alan Carr to its board of directors as the company faces critical debt repayments and looks to overhaul its borrowings, the company said.
Carr is chief executive officer of restructuring advisory firm Drivetrain LLC and has over 20 years of experience with financially distressed companies as both an investor and an adviser, according his firm’s website. Before his current role, he was a distressed debt and private equity investor at Strategic Value Partners LLC.
He joins the board as the retailer faces $134 million of borrowings maturing on Oct. 15. ESL Investments, the hedge fund managed by Sears Chief Executive Officer Eddie Lampert, said in a filing last month that the debt coming due was among the obligations creating "significant near-term liquidity constraints" for the company. Sears mentioned those constraints as part of a proposal it offered to sell real estate to help pay down borrowings, which would cut debt by nearly 80 percent.
"Alan brings deep experience as a director for companies that went through complex organizational change," Lampert said in a statement. Carr has served on the boards of a number of companies that restructured in bankruptcy including Gibson Brands, ExGen Texas Power and LightSquared.
Lampert has been using his own money for years to keep Sears from collapsing as its customers defect and sales fall. The 125-year-old retailer, based in Hoffman Estates, Illinois, has relied on piecemeal deals and infusions from the hedge fund manager to offset billions of dollars in losses.
Sears has also closed hundreds of stores and cut more than $1 billion in expenses. The company’s shares are trading at around 59 cents, down more than 90 percent over the last year.
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