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Orchard Supply Hardware Stores Corp., the chain spun off by Eddie Lampert’s Sears Holdings Corp. 17 months ago, is considering a bankruptcy filing as soon as next week, according to a Bloomberg News story.
Orchard Supply, based in San Jose, California, said in October it had hired Moelis & Co. to help refinance its senior secured loan. It has posted a combined loss of $132.8 million in the past two years. Lampert and his RBS Partners LP fund together hold the biggest stake in the company, with about 21 percent of the shares outstanding as of May 13, according to regulatory filings.
After earlier rising as much as 36 percent, the shares closed up 3.1 percent to $3.04 June 6 in New York.
Sears bought Orchard Supply for $415 million in 1996. Sears said at the time it could operate as many as 500 Orchard Supply stores. It sold a 20 percent stake to Ares Management LLC in 2005 and spun off the remainder in December 2011.
