The losses that drove Sears Holdings Corp. into bankruptcy could end up being a valuable multi-billion dollar asset because of tax breaks — especially for its most notable creditor and Chairman, Eddie Lampert, Bloomberg News reported. As of the retailer’s bankruptcy on Oct. 15, Sears estimated it had net operating losses it could use to offset $5 billion of future taxable income, and separate tax credits of around $900 million. These are the most valuable assets Sears has, and under U.S. tax law, they could disappear in bankruptcy if another company or investor takes the company over. The assets are so prized, that Sears has said they will help its efforts to reorganize. A new, restructured Sears is more attractive with them, and could even use them to buy up another company. But while its survival is up in the air, the tax assets also means Lampert has more of an incentive to keep Sears alive than other creditors. If he doesn’t step in with financing, keeping the tax asset alive, it’s not clear whether other investors will. “He’s in an enviable position," said Robert Willens, a New-York based tax consultant. Willens said that he sees an advantage for Lampert in the bankruptcy. Essentially, if Sears reorganizes and some of its debt converts to stock in a new company, Lampert could take more than half of the new stock without losing the tax assets, whereas other creditors can not.
