Sears Canada Inc.’s top executive is negotiating a private-equity-backed deal for a slimmed-down version of the insolvent retailer, the Wall Street Journal reported today. The proposed offer could be valued at more than 650 million Canadian dollars ($533 million) and would slash the company’s store footprint by more than half. But it could preserve at least 8,000 jobs while paying off bankruptcy loans provided by Wells Fargo Capital Finance Corp. and GACP Finance Co., these people said. The company’s executive chairman, Brandon Stranzl, told employees last month he was preparing an offer designed to save at least part of Sears Canada from liquidation. It filed for protection from creditors in June under the Companies’ Creditors Arrangement Act — Canada’s equivalent of chapter 11 bankruptcy — after operating at a loss since 2014. His deal would be financed partly through private-equity capital sourced by Vadim Perelman, the founder of Los Angeles-based Baker Street Capital Management, and partly with debt financing. The restructured Sears Canada would also assume liabilities associated with employees and retail leases, some of which may be renegotiated.
