Sears CEO says ESL Partners, Fairholme Capital considering deal with Sears Canada

Cole Burston | Bloomberg | Getty Images

A shopper walks past a Sears Canada Inc. store inside a mall in Toronto, Ontario, Canada.

Billionaire Eddie Lampert’s ESL Partners LP and Fairholme Capital Management LLC said they are considering a potential deal with Sears Canada as the retailer looks to restructure itself under bankruptcy protection.

Lampert is the chief executive of U.S.-based Sears Holdings, from which Sears Canada was spun off in 2012.

Sears Canada sought creditor protection last month after suffering a steady decline in sales due to competition from big-box retailers and online merchants.

ESL Partners and Fairholme, which together own about two-thirds of Sears Canada, said on Monday they had engaged a legal adviser and were “evaluating, discussing and considering a potential negotiated transaction” with the retailer.

The firms did not provide any details on the kind of transaction they were looking at, but said the talks could include financing, purchase and sale, or restructuring transactions.

ESL, however, warned that the discussions may not result in a deal.