Sears Canada chairman steps down To attempt a bid to buy

$500,000 fund set up for severance

Lawyers representing workers at Sears Canada and the company have reached a deal to create a hardship fund for former employees who were denied severance payments when they lost their jobs at the retailer. The $500,000 for the fund will come from money set aside to pay bonuses under a key employee retention plan at the retailer, which is restructuring under court protection from creditors. Susan Ursel, who represents the current and former employees, said that the creation of the fund has the support of the company and the court-appointed monitor in the restructuring. “The fund is designed to assist people in situations of precarious hardship, which is to say they are without sufficient resources and are experiencing genuine hardship,” she said. The hardship fund requires approval by the court overseeing the retailer’s restructuring at a hearing set for Friday.

The executive chairman of Sears Canada has stepped down in order to head up a bid to buy the company. As per reports,  Brandon Stranzl is expected to  step away from his day-to-day operations at the company and would focus on putting together a bid to buy the company and keep it going once it emerges from its current restructuring. In June, Sears Canada had announced that it would be restructuring under the Companies’ Creditors Arrangement Act (CAAA) and close almost 60 stores and lay off almost 3,000 employees in the process.

As part of those CCAA proceedings, there’s an upcoming deadline of Aug. 31 for parties interested in buying any or all of the company’s assets to step forward.  Stranzl had been focusing his efforts on finding a turnaround plan for the company after that process ends, and “the intention is to formulate these plans into a bid that can be submitted,” the memo reads. “The goal of any such proposal is to facilitate a path for Sears Canada to emerge from CCAA and so that all of us can continue with the company’s reinvention plans.”

2 Canadians