Sears has gained approval from a bankruptcy court judge for a $350 million loan that would help keep the company running through the holiday season while it attempts to reorganize.
The retailer reached a deal with Cyrus Capital Partners for financing just before a hearing in U.S. Bankruptcy Court for the Southern District of New York on Sears’ debtor-in-possession financing arrangements, according to CNBC.
CNBC reported that Sears took the better offer from Cyrus, in the process rejecting a similar loan offered earlier this month by Great American Capital Partners.
The loan adds to the $300 million in new financing that lenders gave Sears when it filed for bankruptcy protection in October, giving it a total of $650 million. At that time, Sears had secured a $1.83 billion bankruptcy loan, leaving $300 million after it paid off its creditors, according to the Wall Street Journal. Cyrus was in talks with Sears at the time about funding a new loan as part of the bankruptcy proceedings.
Sears also decided against financing from ESL Holdings, the hedge fund controlled by former Sears chairman and CEO Edward Lampert, the WSJ reported. Many observers feel Lambert – Sears Holdings’ largest shareholder as well as its largest creditor – was much of the problem leading to the company’s demise.
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