Bruce Berkowitz Investment Thesis on Sears Holdings …
So Berkowitz, whose fund has gotten crushed by Sears-related equity investments and owns part of the smelly Seritage deal, was the fourth director to jump overboard in 10 months. For whatever pressing reasons he did that — including the flexibility needed to shut down his failed fund and to its aggrieved investors — he certainly must have seen a hopeless scenario that pushes bankruptcy concerns several notches up the scale.
Bruce Berkowitz Steps Down From Sears Board But ..
First, the stock is so hated today that the slightest improvement is likely to have a very significant effect on the share price. Two shareholders -- Chairman Eddie Lampert and Bruce Berkowitz's Fairholme Funds -- control more than 70% of the stock. Of the remaining 25 million or so shares, 11 million have been sold short. With the company's current market cap at $3 billion, it's my belief that the shares of Sears couldn't go much lower without attracting some significant buying.
Berkowitz was either trying his best to keep his fund afloat and lied or he saw what happened to Sears Canada and realized his RE thesis as far as the value of SHLD equity was wrong.