Sears is split in two: Transform Holdco and Sears Holdings. We are Sears Holdings. All the profitable stores were sold to Transform Holdco. But Sears Holdings is not a shell. We are definitely NOT the profitable stores. What we do have is primarily two good things (real estate and NOLs) and one bad thing (debt). We still have debt to be settled. The proceeds from the sale of the profitable stores plus any proceeds from the sale of real estate will go towards resolving the debt issue. Perhaps some of the stores can become profitable. I do think Sears Holdings will survive in a much diminished capacity after debt resolution. But the NOLs make us still attractive to Transform Holdco. At some point I do think Transform Holdco will offer a real buyout. This current deal was referred to as a buyout, but it was just a sale of assets, not a buyout. I do believe a buyout offer will come from Transform Holdco...primarily because of the real estate and the NOLs. The buyout will be nowhere near $47 a share that some are touting. They are mixing the assets of Transform Holdco with our assets. We no longer own the profitable stores. We are attractive because of the real estate and the NOLs. The situation here is NOT $47/share fantastic, nor is it a bleak zombie stock, both sides are delusional. I have no idea what we will be offered, but I suspect it will be higher than current levels. A complete evaluation of real estate holdings (after debt resolution) plus the value of the NOLs may end up being something like $15/share (just an example, I have no basis for this number), but to see that kind of realization per share might well take years. A potential buyout offer by Transform Holdco may come in the form of stock in that company, or a cash offer. If it is a cash offer it will likely be much less than any real value here, but it would be money now (the 'now' being whenever (if ever) it is offered) and a legitimate offer. I think we'll all do better than the current price. In short, don't believe fantastic claims and don't believe dire claims either...we are neither, and somewhere in the middle.
AI
