By age 25, Edward S. Lampert was already a Wall Street wunderkind, celebrated for his intellect, ambition and prodigious work ethic. The famed investor Richard Rainwater, the billionaire Hollywood mogul David Geffen, and Michael Dell and Thomas J. Tisch were among the prominent backers who gave him more than $200 million in start-up capital.
At 28, he was the subject of a front-page profile in The Wall Street Journal headlined “The Climber.” His hedge fund’s 29 percent annualized return landed him on the cover of Businessweek in 2004. Forbes pegged his net worth at $3.5 billion in 2005, ranking him 61st on its annual list of the richest Americans.
Then he bought Kmart out of bankruptcy and merged it with the venerable Sears.
With the bankruptcy this week of Sears Holdings, which he has run as chief executive and chairman since 2013, Mr. Lampert, now 56, was back on the nation’s front pages. The coverage has been as damning as it was once fawning. Mr. Lampert has become the villain, accused of pillaging and destroying an American retail icon to further line his already stuffed pockets.
If that was his intent, it was a singularly inept effort. Mr. Lampert’s steadfast — many would say stubborn — commitment to Sears has cost him billions in personal wealth, not to mention the damage to his reputation. Nearly all of his early investors have abandoned him. His hedge fund’s assets have dwindled. Last year, one of his staunchest backers, the hedge fund manager Bruce Berkowitz, bailed out, saying that Sears had “wrecked” his hedge fund’s returns. The decline of Sears “has been hugely frustrating and fatiguing for me to watch,” Mr. Berkowitz told his investors.
Thanks to his early successes, Mr. Lampert is still very, very rich; his fortune today is estimated at $1.1 billion, according to the latest Forbes survey. He will likely emerge from the Sears collapse with many more assets than most people realize. He owns lavish homes in Greenwich, Conn., and Indian Creek, Fla., just off Miami Beach. But he no longer makes the cut for Forbes’s 400 richest Americans. His net worth has plunged by $3 billion since peaking at $4.5 billion in 2007, the magazine estimates. At Sears, all of his compensation was in stock. He never sold a share. The stock is now all but worthless.
“I’ve taken a huge personal hit,” Mr. Lampert told me this week in a wide-ranging interview, his first since the bankruptcy filing. “Not just in money, but time. There’s been an enormous opportunity cost.”
For more read the full of article at The Nytimes
