Reports: Sears Chairman Wins Bankruptcy Auction For Retailer

(RTTNews) - Sears Holding Corp. (SHLDQ) Chairman Eddie Lampert won a bankruptcy auction for the struggling department store chain that will keep it in business, reports said citing people familiar with the matter.

Lampert reportedly submitted an improved bid for the parent company of Kmart and Sears chains through his hedge fund ESL Investments.

The bid, valued more than $5 billion, prevailed over competing proposals from liquidators, paving the way for the 126-year-old retailer to remain open for business. It it also an improvement from Lampert's previous offer of $5 billion.

Lampert's proposal should save up to 45,000 jobs and keep the department store chain's 425 stores open across the U.S.

The agreement, said to have been reached in the early hours of Wednesday, comes after two days of discussions behind closed doors in New York. However, the agreement still needs to be approved by the U.S. judge overseeing the bankruptcy.

Sears merged with discount chain Kmart in 2005. In recent years, Sears had closed stores, divested brands, and spun off units, while it was struggling with declining sales.

Sears filed for Chapter 11 bankruptcy in mid-October. The retailer also announced a series of actions to position the company to establish a sustainable capital structure, continue streamlining its operating model and grow profitably for the long term, including closing 142 unprofitable stores.

In November, the company had plans of closing 40 more stores and later disclosed intentions to shut down additional 80 stores.