The company filed for Chapter 11 protection from creditors early on Monday, listing more than $10 billion in debts and more than $1 billion in assets. According to ENCA, Sears had been drowning in debt and reportedly could not afford a $134 million repayment that had been due on Monday.
With a history that stretches back to 1886, Sears was once a dominant force in US retail, considered a pioneer of departmental stores. By the mid-twentieth century it had built a vast empire that stretched across North America. But its popularity and profits have since withered with the rise of online shopping and more innovative offerings from competitors.
The retailer said in court papers that it faces catastrophic consequences if it can’t repair its supply chain and keep merchandise flowing to the company’s stores and warehouses, WSJ reports. Edward Lampert, chairman of Sears Holdings, said the insolvency filing would give the company the "flexibility to strengthen its balance sheet" and enable it to accelerate a strategic transformation.
As of the filing, about 700 stores remained open and the company employed 68,000 workers. That's down from 1,000 stores with 89,000 employees that it had as recently as February.
Lampert, the company's largest shareholder, has now given up the title of CEO. The company will now be run by three of the company's top executives.
Iconic US retailer Sears files for Chapter 11 bankruptcy
Sears, the store that changed America, declares bankruptcy
Sears retail shop files for bankruptcy
Sears files for bankruptcy just as things are looking up for American retail
