The day after Sears announced three new small-format stores would open in May, the company made a move to reclaim full ownership of part of the company it spun off in 2012.
Illinois-based Sears Hometown and Outlet Stores announced Monday that it received a proposal Friday from its largest shareholder and Sears Holdings chairman Eddie Lampert's hedge fund ESL Investments to purchase the remaining shares of the company for $2.25 per share.
Lampert, ESL and its affiliates have a nearly 59% stake in the business, according to records Sears Hometown filed with the U.S. Securities and Exchange Commission.
The ownership offer is estimated at $21 million and a 23.6% premium, Lampert wrote in a letter to the Sears Hometown board of directors.
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"We believe our proposal, which will provide certain value and liquidity at a considerable premium to the market price, presents a superior outcome for the Company’s stockholders as compared to the uncertain outcomes facing the Company if it continues on its current path as a stand-alone company," Lampert wrote.
The transaction would be financed with "cash or loans from ESL and our other members," Lampert said.
Lampert said ESL intended to proceed only if the full board approved the proposal "upon the recommendation of the special committee of independent directors that we understand has been formed to consider any proposal from us."
In a statement on Monday, Sears Hometown and Outlet Stores said "the special committee concluded that a transaction on the terms contemplated by the Proposal would not be in the best interests of the Company's unaffiliated stockholders."
But, the statement said, "The parties are continuing discussions regarding potential transactions between the parties."
Sears has closed more than 3,500 stores and cut about 250,000 jobs in roughly the last 15 years as sales cratered, leading to the company's Chapter 11 bankruptcy filing last October.
The company was on the brink of liquidation, but Lampert’s hedge fund made a $5.2 billion offer for the company that was approved by a federal bankruptcy judge in February. About 425 stores and 45,000 employees were transferred to ESL.
Sears Hometown and Outlet Stores – which had 677 locations, including independent dealers and franchisees as of Feb. 2 – has been facing collateral damage from October’s Chapter 11 bankruptcy of the Sears department store chain.
If a deal were to happen in the future, it might reduce costs and extract short term gains, said Neil Saunders, managing director of retail consultancy GlobalData.
"From a brand consistency perspective, there is some logic in Eddie Lampert and his fund taking back control of Sears Hometown and Outlet," Saunders said. "However, the move does very little to guarantee future success. It just creates a larger entity with a lot of unresolved problems."
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This article originally appeared on USA TODAY: Sears Hometown & Outlet: Lampert offers $21 million for full control