Price of one share of Sears Holding Corp. on April 27, 2007: $191.93
Price this morning: $33.31.
So much for synergy.
And don't let that almost-$200 price fool you. It was more a function of float (nearly half the shares were in the hands of hedge fund manager Eddie Lampert) and investors' perception of the break-up value of the company, including its real estate and brands like Craftsman
Even six or seven years ago there was little faith in the retail prospects of the shotgun marriage between one troubled retailer (Sears) and one that had already failed, Kmart.
That said, there are plenty of delicious subplots to the Sears/Kmart story. It's an object lesson in greed, short-term thinking, the perils of failing to invest/upgrade your product, and hubris (the private equity genius who knows he's smarter than anyone else).
Skeptical? When was the last time you shopped at either Sears or Kmart? What was that experience like?
