So was just to by my manager that the whole bankruptcy news is "fake news". Apparently every Kmart had an emergency meeting about this and that everything is fine. Lol. What a joke. We all know the truth.
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https://www.google.com/amp/s/www.wsj.com/amp/articles/big-lenders-make-push-to-liquidate-sears-1539257424 Here is the direct link to the article, also this article about vendors not being paid https://finance.yahoo.com/news/sears-skips-payments-vendors-amid-051304983.html
By Suzanne Kapner and Lillian Rizzo
Updated Oct. 11, 2018 7:59 a.m. ET
Sears Holdings Corp. met with its lenders Wednesday night to discuss emergency financing for the embattled retailer, according to people familiar with the matter. The meeting ended without an agreement that would keep Sears operating as a going concern, according to one of the people.
A group of lenders, including Bank of America Corp., Wells Fargo & Co. and Citigroup Inc., are pushing for the company to liquidate its assets under a chapter 7 bankruptcy filing, as opposed to reorganizing the business under chapter 11, this person said.
A bankruptcy filing is expected by Monday when Sears must repay $134 million in loans, the people said. They cautioned the situation is fluid and that Sears could still find another source of capital to prop it up through a restructuring.
The Wall Street Journal first reported on Tuesday that Sears hired M-III Partners, a boutique advisory firm, to prepare a bankruptcy filing. The company, which had 866 Sears and Kmart stores as of Aug. 4, has been unprofitable for seven straight years and has closed hundreds of locations.
At Wednesday’s meeting, Sears proposed a restructuring plan to shrink its store base dramatically, at which point it expected to be profitable, the person said. But the banks argued the safest way for them to recoup their money is to sell all of the remaining stores and liquidate the inventory, the person said.
The banks are the principal lenders on a $1.5 billion asset-backed credit line secured by store inventory, as well as credit-card and pharmacy receivables. Asset-backed lenders are typically first in line to be repaid in full, often with the proceeds of liquidation sales in retailer bankruptcy cases.
The meeting Wednesday night in New York City included dozens of bankers, lawyers and advisers, but broke up after about an hour with no agreement reached.
It is unusual for a company like Sears, which hasn’t earned a profit since 2010 and has been working with advisers on restructuring efforts, to not have bankruptcy financing lined up this close to a potential filing, restructuring experts said.
Edward Lampert, the hedge-fund manager who controls Sears and is its biggest creditor, has repeatedly bailed out the struggling retailer with short-term loans. But the billionaire CEO doesn’t plan to lend the company money to make Monday’s payment, according to people familiar with the matter.
Last month, the CEO proposed an out-of-court restructuring that would slash more than $1 billion from Sears’s $5.5 billion debt load, divest another $1.5 billion of real estate and sell $1.75 billion of assets, including the Kenmore appliance brand, which Mr. Lampert offered to buy for $400 million.
The Sears board decided not to move forward with the Kenmore transaction, after it became clear this week that Mr. Lampert’s broader restructuring plan wasn’t winning support from creditors, another person said. That prompted the company to seek emergency financing from its lenders.
The company faces a cash crunch as it needs to stock its remaining Sears and Kmart stores for the holidays, and many vendors, from appliance makers to toy companies, now require Sears to pay upfront in cash. It needs several hundred million dollars just for this holiday season, one person said.
Although Mr. Lampert’s hedge fund, ESL Investments Inc., has sunk hundreds of millions of dollars of loans into Sears, the company also has borrowings with the major banks as well as some prominent investors.
As of September, its lenders also included Cascade Investment LLC, which manages the fortune of Microsoft Corp. co-founder Bill Gates, and hedge fund Fairholme Capital Management, whose manager Bruce Berkowitz left the Sears board last year.
Write to Suzanne Kapner at Suzanne.Kapner@wsj.com and Lillian Rizzo at Lillian.Rizzo@wsj.com