"While there's no doubt that a shrunken Sears will be more viable than the larger entity, which struggled to turn a profit, we remain extremely pessimistic about the chain's future", the Market Watch quoted Neil Saunders, managing director of GlobalData Retail as saying in a statement.
Lampert's purchase, made through his hedge fund, ESL Investments, is meant to keep 425 Sears and Kmart stores open, preserving some 45,000 jobs. Those creditors, including vendors and landlords, argued they would fare better in a liquidation and that the process for selling Sears was unfair.
In his ruling, Drain dismissed arguments made by a committee of unsecured creditors who requested that the court order the liquidation of the department store chain instead of accept the restructuring offer. Drain has repeatedly expressed a desire to save the jobs of as many of Sears' employees as possible.
Attorney David Wander, who represents four creditors, including two apparel manufacturers, said the approval of Lampert's bid is good for everyone. A Sears executive said during the hearing that the company wasn't sure how many stores it would sell in meeting those financial goals. "The state of Sears is going to be in the court's hand".
"The reality, as we know from our lived experience, is that Lampert has been putting the company through the longest liquidation in retail history".
"Other than the things-that-we-make-money-in store, there is nothing from a consumer standpoint to ties that all together", he said.
"The benefits of the sales process really do outweigh an orderly wind down", he said. The takeover aims to preserve about 45,000 jobs.
A plan to keep Sears Holdings Corp. alive and tens of thousands of people employed was approved Thursday by a federal Bankruptcy Court judge. PBGC believe the two pension funds for 90,000 Sears retirees and beneficiaries are underfunded by $1.4 billion.
The agency had agreed to reduce the amount of underfunding it would ask Sears to cover from $1.7 billion down to $800 million, according to Schrock.
The most serious issue left to be decided is how much of the $166 million in accounts payable Lampert and his hedge fund ESL are willing to assume. But Drain said those claims shouldn't stand in the way of Sears's sale and instead would likely be decided in future lawsuits.
"This is an important issue", Schrock said.
Terms of the sale allow for some litigation to continue against Lampert and ESL.
After approving the deal, Drain took the unusual step of defending Lampert. Sears directors rejected his request to receive a broader legal release covering those deals, which creditors contend robbed them of value.