Sears Holdings Corp. drew down the remaining $60 million on a $200 million loan, signaling that the struggling department-store chain is quickly running through cash.
The retailer set up a revised loan on Oct. 4 and borrowed an initial $100 million, according to a filing on Monday. It tapped an additional $40 million on Oct. 18 and then the final $60 million a week later.
The run-up to the holiday season can be a capital-intensive period for retailers, as they amass inventory and ready promotions. Sears announced last week that it was reviving its “wish book” catalog in a bid to build buzz .
Sears has posted roughly $11 billion in losses over the past six years, forcing the Hoffman Estates, Illinois-based company to offload real estate and sell other assets to stay afloat. It’s also borrowed money from its own chief executive officer, Eddie Lampert, a hedge-fund manager who is also Sears’s biggest investor — and the source of the latest loan.
The $200 million loan has an annual interest rate of 11 percent, with Sears’s properties acting as collateral.
