Sears Holdings is faced with “near-term liquidity constraints” and should sell $1.75 billion in assets including the Kenmore appliance brand, in a bid to avoid bankruptcy, according to an SEC filing today by Sears CEO Eddie Lampert’s hedge fund ESL Investments.

Lampert, who also is Sears’ chairman and controlling shareholder, wants creditors to restructure $1.1 billion in debt due in 2019 and 2020. In addition to assets, ESL’s proposal also calls for selling $1.5 billion of real estate. Lampert has offered to buy the Kenmore brand for $400 million. The restructuring plan would reduce Sears’ $5.5 billion debt to about $1.24 billion provided the company’s board approves it, ESL Investments said.

Lampert rescued Kmart from bankruptcy in 2005 and combined it with Sears. He has since closed hundreds of stores, but the retailer has lost $11 billion since 2011. Sears had 866 stores (360 Kmart, 506 Sears) as of Aug. 4, down from 1,250 (610 Kmart, 640 Sears) a year earlier.

Contact:

Sears Holdings, Robert Riecker, CFO, 847-286-2500.