When Sears Holdings announced an unanticipated 83% increase in quarterly profit on Thursday, the retailer also said it may spend some of its $3.7 billion in cash on acquisitions. The news prompted some wild speculation amongst analysts to compare the retailer to a new Berkshire Hathaway or a publicly traded hedge fund. Of course, comparing Sears chairman Eddie Lampert to Warren Buffett is fast becoming the business media's favorite pastime.
At any rate, here at Dealscape, we try to keep those comparisons to a minimum, so we saw the news and began to wonder who Sears might be interested in purchasing to prop up this ugly pig of a retail play. One suggestion coming from MarketWatch's Herb Greenberg set our brains into high gear. He suggested that Lampert would again look into his own portfolio of companies, so he's betting on AutoZone being Sears' first target. At first, Greenberg's idea makes sense. The Sears merger from the get-go was an all Lampert deal. However, on second thought, the recent bankruptcy of R&S Parts & Service Inc. suggests it may not be such a smooth move. R&S, which does business under the Strauss brand of auto parts stores in New Jersey, New York and Pennsylvania, blamed the high price of gas as one of its reasons for the Chapter 11 filing. This is the same problem facing rival retailer Pep Boys - Manny, Moe & Jack, which recently garaged its auction because of poor earnings related to slow retail sales.
Consequently, we decided to search The Deal's Auction Block database to see what other retail and consumer businesses are on the market. Currently, there are 34 active auctions, but not all of them would be good fits for Sears. A few that stood out appear in a table below.
See post from DealBook
See post from Herb Greenberg's blog at MarketWatch
See Auction Block
Possible targets for Sears
Consumer and retail businesses on the block |
| Name |
Auction likely
price range
($ millions)
|
Business |
| Le Chateau Inc. |
$ 265 |
Canadian retailer of trendy clothes |
| Woolrich Inc. |
$90 |
Apparel maker |
| Pier 1 Imports Inc. |
n/a |
Home furnishings retailer |
| RedEnvelope Inc. |
$100 |
Online and catalog gift retailer |
| Eddie Bauer Inc. |
$700 |
Apparel retailer |
| True Religion Apparel Inc. |
$400 |
Apparel retailer |
| Foot Locker Inc. |
$4,000 |
Sneaker retailer |
Federated Department Stores Inc.
bridal group |
$700 |
Bridal and tuxedo shops |
| Helly Hansen Holding |
$200 |
Ski and outdoor apparel |
| London Fog - brand |
n/a |
Bankrupt apparel brand |
| Yankee Candle |
n/a |
Candle retailer |
| Vivarte |
$ 1,900 |
European retailer |
|
—Matthew Wurtzel
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