What happened
Shares of Sears Holding Corp. (SHLDQ) were slipping again as concern built among its suppliers that the company would soon declare bankruptcy. As of 12:14 p.m. EDT, the stock was down 2.9% after falling as much as 6.3% earlier in the day. It was Sears' fourth significant decline in the last five sessions.
Image source: Sears.
So what
More signs are emerging of the department store chain's impending doom. Earlier this week, CEO Eddie Lampert was feuding with its top tool vendor, Techtronic Industries, after it threatened a lawsuit against the retailer and to cancel its contract with Sears.
Other suppliers have also backed out of arrangements with Sears, and parts of its stores are empty or barely stocked as it has had trouble keeping adequate inventory levels. Lampert complained of suppliers treating his company like a pariah last week, and the reports are the latest evidence of key partners abandoning it.
Now what
Earlier this week, Barry Sternlicht, the CEO of Starwood Capital, a prominent mall owner, essentially said he was hoping for the retailer's demise as it would open valuable space in his malls, allowing him to bring in more attractive tenants and charge higher rents.
When even Sears' key partners, like its landlords and partners, seem to be cheering its death, that's a serious problem. There seems little chance of the company's underlying business improving. At this point, it's only a matter of time until it declares bankruptcy.
