Sears pops after report says its closing in on a deal that could keep it open through the holidays

  • Sears filed for bankruptcy last month, saying it would close 142 US stores before year end.
  • On Wednesday, the iconic US retailer said it is nearing a deal to increase its existing financing package to $650 million, allowing the 125-year-old retailer open through the coming holidays, Reuters reported.
  • Shares soared as much as 28% following the news.
  • Watch Sears trade live.

Sears exploded by as much as 28%, to a high of $0.47, Wednesday after a report said it is nearing a deal that would keep it open through the holidays.

The iconic American retailer filed for Chapter 11 bankruptcy last month, saying it received approval to access a $300 million loan to keep it afloat during restructuring, and that it would close 142 US stores before the end of the year.

On Wednesday, Reuters reported that Sears is finalizing a deal with the financial firm Great American Capital Partners and other lenders, to increase the existing bankruptcy financing package to $650 million, allowing the 125-year-old retailer to remain open as Black Friday nears. 

RELATED: Take a look at more retailers that filed for bankruptcy in 2018: 

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Every retailer who filed for bankruptcy in 2018

A'gaci

Women's apparel and accessories retailer A'Gaci filed for Chapter 11 bankruptcy in January. 

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Kiko USA

Cosmetics retailer Kiko USA Inc filed for Chapter 11 bankruptcy protection in January.

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Tops Markets

Tops Markets operates 174 supermarkets — called Tops Friendly Markets. The company filed for bankruptcy protection in February.

Photo credit: Getty

The Bon-Ton Stores

The Bon-Ton Stores owns multiple department store chains including Bon-Ton, Bergner's, Boston Store, Carson's, Elder-Beerman, Herberger's, and Younkers. The company filed for bankruptcy in February.

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Remington Outdoor

Remington filed for Chapter 11 bankruptcy protection in March.

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The Walking Company

The shoe seller The Walking Company, which operates 208 stores in the US, filed for Chapter 11 bankruptcy protection in March.

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Claire's

The jewelry chain Claire's filed for bankruptcy in March.

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Southeastern Grocers

Southeastern Grocers, the parent company of the grocery chains Winn-Dixie, Harveys and Bi-Lo, filed for Chapter 11 bankruptcy protection in March.

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Nine West

Nine West Holdings filed for bankruptcy in April.

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Bertucci's

Italian casual-dining chain Bertucci's filed for Chapter 11 bankruptcy protection in April.

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Rockport

The footwear brand filed for Chapter 11 bankruptcy protection in May.

Photo credit: Getty

National Stores

The owner of the Fallas chain of discount stores filed for bankruptcy in August.

Photo credit: Facebook

Brookstone

Brookstone filed for Chapter 11 bankruptcy protection in August.

Photo credit: Getty

Samuels Jewelers

Samuels Jewelers filed for Chapter 11 with an agreement for bankruptcy financing in August.

Photo credit: Facebook

Toys R Us

Toys R Us filed for bankruptcy in September.

Photo credit: Getty

Mattress Firm

Mattress Firm filed for bankruptcy in October.

Photo credit: PA

Sears

Sears filed for bankruptcy in October.

Photo credit: PA

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In exchange for the $350 million loan, Great American and the other firms are expected to receive some Sears collateral previously held by banks to back the new financing, one of the Reuters sources said.

The loan would give Sears additional breathing room to seek buyers for its assets. Sears picked Great American's proposal for a bankruptcy loan instead of an offer from hedge funds including Cyrus Capital Partners LP, Reuters sources added.

Sears' stock topped out at more than $122 a share in 2007, giving the retailer a market capitalization of nearly $30 billion. But years of losing money and closing stores, along with shifts in consumer spending, and the rise of e-commerce, among other things, eventually leading to a collapse in share price and an its eventual bankruptcy filing.

Sears was down 90% this year, leaving it with a market cap of $30.8 million.

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