American based retailer Sears Holdings has to face legal action from Bangladeshi RMG makers for allegedly refusing to settle more than $40 million in outstanding dues. According to the suppliers’ lawyers, more than $21 million of their clients’ products have already been shipped and are being stored by Transformco’s carriers in US ports.
According to a report of Sourcing Journal, they alleged that Transformco, a privately held company owned by American billionaire Eddie Lampert’s ESL Investments hedge fund and current owner of Sears Holdings, ‘willingly misrepresented’ its finances to convince suppliers to extend its credit.
Rakibul Alam Chowdhury, Managing Director of Combined Apparel, told a news agency, “I sent shipment worth $6 million for (Transformco) but the company suddenly called me for canceling the order.
More than two dozen Bangladeshi suppliers are in similar ‘deep trouble’ after Sears Holdings allegedly canceled or withheld orders and they are not paying us added Rakibul.
Late April, Transformco, which also owns Kmart, temporarily closed all Sears’s stores—but not distribution centers or customer care in a bid to help slow the spread of the COVID-19 contagion.
As of June 5, Sears has reopened 53 locations across the United States.