After filing for bankruptcy, Sears' former CEO Eddie Lampert gives hope that the company can still make it and avoid liquidation. At a meeting held Tuesday, the CEO described the upcoming holiday season as a do-or-die one.
Speaking with 1000 employees at the meeting, the CEO claims that Sears can still avoid a shutdown and liquidation if they all work hard to achieve and demonstrate "material progress" over the next few months. On the exclusive audio that CNBC was able to gather of the meeting, the CEO can be heard saying they need to prove this significant progress to the senior leaders of the company.
Just this Monday, the retailer filed for bankruptcy, citing debts and declining sales as the main reasons Based on the options granted by Chapter 11 protection, Sears can close off its unprofitable stores and then sell roughly 400 of those still performing relatively well in order to stay afloat.
Lampert, who also stepped down as CEO on Monday, after serving five years on this position, claimed that this speech was the second most difficult public speech he has ever to make. It followed closely the difficulty of speaking at his father's funeral 41 years ago.
On his speech, the CEO also admitted the opportunities that the company was not able to leverage on and the missteps they had made along the way. He believed that there was a great opportunity to become a different kind of retailer when Sears and Kmart merged in 2005, but that opportunity was not capitalized on. "Instead of growth and investment we have faced retrenchment and restructuring," he admitted.
Following its bankruptcy announcement, Sears has received $300 million in financing so that it would have the ability to stay open and hopefully, pay off its debts. The company is reportedly negotiating an another $300 million in financing from ESL. The latter is Sears' largest shareholder and creditor.
The CEO also mentioned feeling personally responsible for the fiasco because of the many mistakes and failures committed when he was still the CEO. Even though he remains at the moment the chairman of Sears Holdings, he had been accused of many negative things, including making Sears impossible to pay off its debt and generate sufficient cash flow.
The CEO however assured that he would do everything to make sure the company will protect and honor its associates and retirees. He asserted that he feels strongly about this.
Sears has over 68,000 employees, as shown by the bankruptcy documents filed. Honor member programs will also be continuously honored.
