American retail titan Sears has filed for bankruptcy as they cave under a $190 million debt.
The retail icon’s stock price took a dive last week after reports it hired an advisory to prepare for bankruptcy before the million-dollar debt payment, which was due on October 15, the same day they filed for bankruptcy.
The news follows the closure of a suite of retailers worldwide, as brands feel the pressure of competition with e-commerce giants like Amazon.
For years, Sears trailblazed the retail landscape with an innovative product line and delivery service seeing the retailer applauded as the Amazon of a century ago.
The giant is known for transforming the American retail landscape, redefining the American shopping experience through door-to-door shipments, unique appliances and fashion trends.
But for years the retailer has been struggling with mounting debt of more than $11 billion.
The pressure came to a head just days ago as Sears’ parent company, Sears Holdings announced Serars were filing for bankruptcy and taking “a series of actions to position the Company to establish a sustainable capital structure.”
Chairman of Sears Holdings, Edward S Lampert said that the retailer has for years been trying to make progress.
“Over the last several years, we have worked hard to transform our business and unlock the value of our assets,” he said.
“While we have made progress, the plan has yet to deliver the results we have desired, and addressing the Company’s immediate liquidity needs has impacted our efforts to become a profitable and more competitive retailer.”
The retailer plans to re-evaluate its business structure to find ways to keep its head above water.
Sears’ hedge fund, ESL has already made an offer to help the company through bankruptcy through a $300 million in debtor-in-possess financing.
“Subject to Court approval, the DIP financing is expected to improve the Company’s financial position immediately and support its operations during the financial restructuring process,” a release says.