Sears Reportedly Seeks Sale Of DieHard Brand, Other Assets

Transform Holdco, the parent company of Sears operated by the retailer’s former CEO Eddie Lampert, has hired investment bankers to advise the company on sales of potential assets, including the DieHard brand, according to a report from The Wall Street Journal.

The move would be the latest asset sale for the Sears brand, coming two months after the holding company sold off the Sears Hometown and Outlet Stores unit to Liberty Tax for $132.9 million. In 2017, Sears sold off its Craftsman tools brand to Black & Decker for $900 million.

Despite having sold off many assets both before and after its Chapter 11 bankruptcy filing, Sears yet again recently borrowed $150 million from lenders, including Lampert and his hedge fund ESL Investments. The new financing is intended to help stock Sears store shelves for the holiday shopping season. In April, the Sears bankruptcy estate sued Lampert and ESL, claiming they wrongfully stripped $2 billion in assets from the company as part of the various sales.


The suit claimed Lampert promised an unrealistic turnaround, including by directing employees to produce financial plans reflecting “fanciful, bad-faith” predictions. The company then pursued fraudulent transactions involving Orchard Supply Hardware Stores, Sears Hometown and Outlet Stores, Sears Canada and Lands’ End, with allegations including that:

  • Lampert rejected a $1.6 billion bid for Lands’ End from Tommy Hilfiger and Leonard Green & Partners in favor of a spinoff that would retain his stake, which earned him at least $490 million;
  • The real estate at 266 Sears stores was undervalued by at least $649 million when it was spun off to Seritage Growth Properties (a Lampert-owned property), then leased back to Sears with unfair terms;
  • Sears shareholders received Orchard stock valued at more than $100 million from the 2011 spinoff, but Sears itself was paid nothing.

ESL denies all allegations, and Lampert returned fire with a lawsuit of his own against the estate in the following month.

Aside from the lawsuits, Lampert has been under fire from industry insiders due to the continued paring down of the Sears brand.In cases where ESL Investments buys an asset from Sears, such as Lampert’s proposal to buy the Kenmore brand for $400 million in 2018, Lampert would still own the property and make money from it, despite the retailer’s ongoing financial difficulties. Kenmore is not part of the present asset sale discussions.

Upon winning the $5.2 billion lifeline bid to buy Sears out of bankruptcy, Lampert previously promised employees and the bankruptcy court that the company could preserve up to 45,000 jobs. He and his partners also said they would enhance the retailer’s performance by running only 425 of its profitable Sears and Kmart stores, rather than the nearly 700 stores operating when the company filed for bankruptcy. But since then, things have only gotten worse for Sears, with the retailer set to close roughly one quarter of the 425 remaining stores by year’s end, the WSJ reported.

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