Newsmaker

Every Friday, we choose an alum who has been making headlines—for better or for worse.
Ico print Print | Ico email Email | Facebook | | RSS

Eddie Lampert ’84: Sears seared

By Carole Bass ’83, ’97MSL | 11:06am December 12 2013

Hedge fund billionaire Eddie Lampert ’84 has earned many epithets in his nearly 30-year investment career: the next Warren Buffett. The Steve Jobs of the investing world. "The greatest investor of his generation."

Now, after his backers forced Lampert's ESL Investments to give up majority control of Sears Holdings, Lampert has a new slew of descriptors: stubborn. Vulnerable. "The man who flushed Sears down the toilet."

Lampert remains chairman and CEO of Sears Holdings, owner of such retailers as Sears, Kmart, and Lands' End (which it's about to spin off). But the company's fate is unclear. "Sales have declined for 27 straight quarters and the company’s stock is down over 70 percent from its high in 2007," Forbes notes, with analysts accusing him of milking the company for cash.

In his Yale days, Lampert worked for Nobel-winning economist James Tobin and mystified his colleagues in a student investment club. "Lampert would suggest complex investments such as risk-arbitrage plays," Bloomberg reports, quoting the club's chair, Joseph "Skip" Klein ’83: "Most of us [wondered]: How the heck does he know about this?'

After graduation and an early stint at Goldman Sachs, where Lampert stood out "even in a department filled with hotshots," he founded his own ESL Investments. He made headlines in 2003 when he was kidnapped and held hostage for two days.

This week, Lampert hung tough despited his pummeling in the markets and the media. "My significant personal ownership in the company is a sign of my confidence and alignment with all shareholders,” he declared. And a young hedge fund manager from LA voted with his checkbook, boosting Baker Street Capital's stake in Sears Holding to 10.8 percent.

Filed under Eddie Lampert, Sears
The comment period has expired.