PALM BEACH, Fla., Dec. 30, 2011 (GLOBE NEWSWIRE) -- One of 2011's biggest economic stories was the record-breaking profit recorded during the holiday shopping season; according to Forbes, 2011's online sales figures were the highest of all time. The downside to high digital retail sales has proven to be the continued decline of many brick-and-mortar establishments, including Sears, which, after reporting weaker-than-projected holiday sales figures, announced that it would be shutting down 100 or more locations in 2012. The company is in a bad place, but private equity expert and financial analyst Brad Kuskin says new investors could be Sears' salvation—and that Sears could prove a smart opportunity for investors, as well.
Brad Kuskin, a long-time investment analyst and private equity industry leader, has most recently worked with real estate investment group National Property Trust. As a specialist focused on real property assets, he said in a statement that what happens to dying retailers like Sears could ultimately be the biggest private equity story of 2012. "Investing in a company like Sears presents clear problems, but, for savvy investors, it could also hold great promise."
Brad Kuskin points to a couple of key assets that might make Sears a target for private investors. The first is its significant Canadian presence. "While American Sears locations have struggled, its Canadian holdings are significantly more valuable due to a stronger Canadian economy and higher barriers to competition — in fact, Sears' Canadian assets are worth over $1.8 billion," Kuskin notes. But the big thing is the real estate. "Sears has 850 locations, to say nothing of a dozen distribution centers, plus office space. That's incredible real estate that will be even more valuable to private investors looking to capitalize on the current downturn in real estate investments."
Of course, Brad Kuskin's prediction that Sears will attract private investors is not a unanimous one. Fortune.com editor Dan Primack noted, "the company's debt-load is larger than its market cap," and predicted an overall "lack of interest" among private investors. However, Riverside Company executive Stewart Kohl, commenting on the future of private equity, noted that private investment was "part of the solution," not "part of the problem," something that affirms Brad Kuskin's prediction that private equity may be the best path for Sears' success.
The private equity expert cautions that his Sears prediction is not necessarily meant to be an endorsement, and says that something on the scale of Sears will not be right for every venture capitalist. However, Brad Kuskin observes that "all the signs of a risky but potentially very rewarding investment are there, and it could be a real benefit both for the company and for potential investment groups."
ABOUT:
Brad Kuskin is a private equity expert and investment analyst who has previously spearheaded projects regarding real estate investment, start-up businesses in their incubation phase, firms ready to take the leap to an Initial Public Offering, asset acquirement, medical refuse industry, digital music cataloguing, photo imaging technologies, auto accessories, specialty publications, and more. He is currently involved with an investment group called National Property Trust, which has been organized to help highlight potential areas of investment while helping clients place funds in appropriate opportunities.