Sears Holdings creditors could finally get a payday via new settlement agreement
Chicago — While payouts may be relatively meager, some relief could come for vendors who left the bag when Sears Holdings filed for bankruptcy four years ago.
Last week, Sears Holdings and its former creditors said they had reached a settlement, according to several reports. The $175 million settlement stems from a lawsuit against former CEO and majority owner Eddie Lampert and other investors, who plaintiffs have accused of regularly stripping the company’s assets in the years before its filing. under Chapter 11.
The settlement requires federal bankruptcy court approval.
Retail Dive reports Sears Holding settlement would be financed by three entities: $125.6 million from insurers, $41.9 million from defendants and $7.5 million from participating funds.
What remains of Sears Holdings was acquired by Lampert-controlled Transformco in 2019. Although e-commerce operations continue, there are fewer than two dozen Sears and Kmart stores in operation today.
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