Some Sears Holding Corp. partners have come out in support of a proposal by Eddie Lampert’s hedge fund that would avoid liquidating the department-store chain and keep stores open, according to a court filing, Bloomberg News reported. Vendors that are owed money for goods shipped to Sears within 20 days of the retailer’s bankruptcy, including furniture company Mien Company and apparel distributor Strong Progress Garment Factory Co., support the bid because they don’t think the retailer’s wind-down fund has enough money to pay their claims, according to a court filing. The merchants “believe the bid of ESL Investments provides them with the best chance to be paid in the fastest manner,” according to filing in federal bankruptcy court that was dated Jan. 7. “The Mien vendors do not want to see the debtors’ remaining stores liquidated.” Numerous vendors said they are willing to help out ESL’s bid by providing trade credit, according to the filing. “I’m hopeful for a last-minute reprieve. I don’t want to lose another customer,” said Joe Shamie, president of Delta Enterprise Corp., a Sears vendor that manufactures children’s furniture. Read more.
One of the worst outcomes for a business owner is having a major customer file for bankruptcy and leave behind a large unpaid account receivable. ABI's Business Creditor’s Guide to Distressed Vendors, Debt Collection and Bankruptcy provides an insider’s look into the options available to help screen a business’s customers, plan for worst-case scenarios, and, if the situation does arrive, efficiently handle the fallout.
