Transformco

Sears Holdings On November 17, 2004, the management of Kmart Holding Corporation announced its intention to purchase Sears, Roebuck and Co. under a new corporation. Kmart previously emerged from Chapter 11 bankruptcy protection on May 6, 2003. The new corporation became known as Sears Holdings Corporation, simply known as Sears Holdings. The new corporation announced that it would continue to operate stores under both the Sears and Kmart brands. The merger of Kmart and Sears closed on March 24, 2005, following affirmative shareholder votes of both companies. The result of the merger was Kmart and parent Kmart Holding Corporation and Sears became subsidiaries of the new Sears Holdings Corporation. Sears Holdings then operated Sears and Kmart stores. The company continued to market products under brands held by both companies. The merger was completed on March 24, 2005, after receiving regulatory approval from the government and approval by shareholders of both companies. The combined company had approximately 3,500 stores at the time of the merger. Eddie Lampert led the company for the next thirteen years. (See Sears Holdings#History for more detailed history of the intervening years.) On October 10, 2018, it was reported that Sears Holdings had engaged advisors regarding an imminent bankruptcy filing. The company filed for Chapter 11 bankruptcy protection on October 15, 2018, in New York; the same day that a $134 million debt payment was due. On October 15, 2018, Sears Holdings announced that it would close 142 stores, including 63 Kmart stores and 79 Sears stores. Sears Holdings' bankruptcy also marked Kmart's second bankruptcy in 16 years. On November 8, 2018, Sears Holdings announced it would close an additional 40 stores, including 11 Kmart and 29 Sears stores. On November 23, 2018, Sears Holdings released a list of 505 stores, including 239 Kmart and 266 Sears stores, that were for sale in the bankruptcy process while all others were holding liquidation sales. However, the stores for sale were not guaranteed to be protected from liquidation in the future. On December 28, 2018, Sears Holdings announced it would close 80 additional stores, including 37 Kmart and 43 Sears stores. In a proposal announced in early January, Sears Holdings planned only to keep 202 Kmart stores along with 223 Sears stores open, assuming that it survived the bankruptcy process. Most of the proposed locations were in highly populated coastal regions. On January 15, 2019, when it had appeared that Sears Holdings was preparing to file for Chapter 7 liquidation, the bankruptcy court judge ordered the company to return to the negotiation table and work out a new deal with Eddie Lampert to prevent the liquidation from occurring. A new deal was struck at the last minute that would keep up to 400 Sears and Kmart stores operating. On January 19, 2019, Sears Holdings officially announced that they had won the auction, and that some of the then existing stores were to remain open. On January 24, 2019, a group of unsecured creditors, which included Simon Property Group, filed a motion with the bankruptcy court to overturn the deal Sears Holdings had recently made with Lampert claiming that Lampert had been "engaged in serial asset stripping" of the company at the expense of suppliers and landlords. The creditors had requested that the bankruptcy court rule to have the company be liquidated instead of being reorganized so that the creditors would be able to recover more money that was still owed to them. On January 28, the federal government-operated Pension Benefit Guaranty Corporation announced that they were not in favor of the current Sears Holding agreement with Lampert since that agreement would create a $1.7 billion funding gap in the employee pension fund that would require the American tax-payers to cover the shortfall. In papers filed on February 1 with the bankruptcy court, ESL "outlined plans to close three Kmart stores per month in 2019" if the court decides to accept ESL's purchase bid. In February 2019, it was announced that a U.S. bankruptcy judge approved the sale of the most lucrative part of Sears Holdings to Edward Lampert, allowing the surviving part of the company that operates both Sears and Kmart to remain in business at the expense of suppliers, landlords, employees, pensioners, the U.S. government, and other creditors. Kmart would have 202 locations after the sale was completed. Birth of Transformco In February 2019, the company finalized the acquisition of 425 stores (223 Sears and 202 Kmart) from Sears Holdings for $5.2 billion. Stores not purchased by Transformco were immediately liquidated. In June 2019, Sears customers discovered that they were having a hard time getting warranties honored for items previously purchased from Sears. New store closures and assets reduction under Transformco On August 6, 2019, it was announced that Transformco would be closing 26 stores, including 5 Kmarts and 21 Sears stores, in October. These closures would result in approximately 380 remaining stores. On August 31, 2019, it was announced that Transformco would close an additional 92 stores, including 77 Kmarts and 15 Sears stores, by the end of 2019. On November 7, 2019, it was announced that Transformco would close an additional 96 stores, including 45 Kmarts and 51 Sears stores, February 2020, leaving 70 Kmart stores in 19 states, Guam, Puerto Rico, and United States Virgin Islands, and 123 Sears stores, respectively. At least one source reported in November 2019 that Transformco would have a total of 182 full Sears and Kmart stores remaining after the 96 announced stores were closed by February 2020. Under this agreement, Sears and Kmart can continue to sell DieHard branded batteries through their stores while Advance Auto Parts has exclusive rights to the DieHard brand in the automotive and vehicular supplies and service industries. Throughout June and July 2020, Sears' job website indicated that over twenty more stores were in the process of closing. In December 2021, Transformco announced its plans to sell the Sears headquarters in Hoffman Estates. The property was eventually sold to a data center developer in the Summer of 2023 with plans to have the existing buildings demolished by Fall 2023. The fate of the Sears headquarters staff was not published. In 2022, the owner of Sears confirmed that the last full-line Sears store in Pennsylvania, in Abington Township, Montgomery County, was closing. On January 21, 2022, the last remaining Searstown in Fort Lauderdale, Florida abruptly closed at the end of the day without any prior announcement or liquidation. On August 29, 2022, it was announced that the Sears at Newburgh Mall would be closing in fall of 2022, marking the end of an era after 43 years as the last original anchor store in the mall as well as the last Sears department store in New York. The closing date for this store was announced two days later on August 31, 2022, in a Facebook post with the final day of operation being Sunday, October 16, 2022. On September 22, 2022, it was announced that Sears would be closing at the Valley Mall in Union Gap, Washington, by Sunday, November 20, 2022. A day later, it was announced that Sears would be closing at Burbank Town Center in Burbank, California, the last original anchor from opening day of 1991. This was also the last store in the Greater Los Angeles Area to be connected to a mall. On October 15, 2022, it was announced that the only remaining Kmart store in Puerto Rico at the Plaza Las Americas would be closed by the end of that month. The last Sears in Maryland closed its store at the Francis Scott Key Mall on January 15, 2023. On March 28, 2023, the Kmart store in Miami, Florida downsized and moved to the garden area of the store. The rest of the store will be leased to home decor giant At Home. On April 14, 2023, it was announced that the last Sears store in North Carolina would close by the end of May. On June 5, 2023, it was announced that the Kmart store located at the Sunshine Mall in St. Croix would close. On August 2, 2023, it was announced that the last Kmart store in New Jersey will close September 30, 2023. ==Transforming into a commercial real estate company==