Sears Puts Forward Bid To Save Company From Liquidation

In an earlier blog, we wrote how Sears Canada had engaged federal bankruptcy and insolvency legislation in to buy time while its leadership formulated a plan to restructure the company. The plan has now arrived.

Sears Canada executive chairman, Brandon Stranzl, has fielded a plan to save a small portion of the company. The plan, if approved by creditors, could save upwards of 7,000 jobs across 60 stores. 59 stores have already been liquidated.

Under the Companies' Creditors Arrangement Act (CCAA), Sears' creditors must approve of the plan, called an arrangement or compromise under the Act, before the court decides whether or not to sanction the deal. Under s. 6(1) of the Act, this requires the approval of ½ in number of each 'class' of creditors representing ⅔ of value held by that 'class' (called the 'double majority rule').