Sears Holdings: ESL (Eddie Lampert) amends 13D disclosing non-binding proposal for the acquisition of Kenmore and SHIP (1.83 +0.04)
- On August 14, 2018, ESL delivered a letter to the Special Committee pursuant to which it submitted a non-binding proposal for the acquisition of Kenmore and SHIP (the "Bid Proposal") and to update the Special Committee regarding its plans with respect to Parts Direct and certain other transactions, as well as to re-emphasize its firm belief that these transactions should be undertaken together with tender and exchange offers designed to allow Holdings to reduce its debt, extend its maturity profile and alleviate its liquidity challenges. The Bid Proposal indicates that ESL is proposing to acquire Kenmore in a cash acquisition based on a cash-free, debt-free enterprise value of $400 million, subject to adjustment in respect of the working capital and assets and liabilities of the Kenmore business at closing. The Bid Proposal notes that ESL has been discussing with potential partners their participation in the acquisition of Kenmore, and that the transaction would be conditioned on ESL's receipt of equity financing from a potential partner on terms acceptable to it.
- The Bid Proposal also indicates that ESL is proposing to acquire SHIP in a cash acquisition based on a cash-free, debt-free enterprise value of $70 million, subject to adjustment in respect of the working capital and assets and liabilities of the SHIP business at closing. In addition, the Bid Proposal contemplates an additional contingent payment of $10 million if the 2018 stand-alone EBITDA of the SHIP business achieves 85% of the SHIP management projections (inclusive of stand-alone adjustments).
