Sears CEO D'Ambrosio resigning for "family health matters" - FOX 29 News Philadelphia | WTXF-TV

Sears CEO D'Ambrosio resigning for "family health matters"

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CHICAGO (FOX 32 News) -

Louis J. D'Ambrosio is stepping down from his role as CEO of Sears Holdings Corp., the company announced Monday.

A company news release cited "family health matters" as the reason for his exit and stated that D'Ambrosio will leave the executive post on Feb. 2, the end of Sears' fiscal year. Edward S. Lampert, chairman of the company's board of directors, will then assume the role of CEO.

A source close to D'Ambrosio said a member of his immediate family is "dealing with a health crisis, and at this time [D'Ambrosio] decided to be at home where he needs to be."

D'Ambrosio's departure only adds to Sears' instability. The CEO has been with the company for less than two years, and when he came, he was its first permanent CEO in three years.

Revenues have fallen for the past five years, as the 126-year-old retailer has struggled to fend off more nimble, faster-growing rivals. The company has sold off underperforming stores.

In announcing D'Ambrosio's resignation, Sears also announced it expects to report a $280 million to $360 million loss ($2.64 to $3.40 per share) in the fourth quarter, which ends Feb. 2. The loss includes a non-cash charge of $450 million in pension settlements and $42 million in pension expenses.

The company expects to report a full-year loss of between $721 million and $801 million ($6.80 to $7.56 a share).

Sears has been facing an uncertain future since it merged with Kmart in 2005. Analysts have said the Hoffman Estates based retailer still has years to go but is inevitably headed to liquidation.

But company spokesman Chris Brathwaite said Monday that Sears is in a much better position than it was a year ago.

"Over the past 12 months the company increased liquidity by $1.8 billion . . . and lowered net debt by $400 million. 2012 was a turnaround year for Sears Holdings — we were clear about areas that we would focus on, and we delivered," he said.

D'Ambrosio will maintain his position on the board until the company's next annual meeting of stockholders in May and will be available to assist with a smooth transition, the company announced.

D'Ambrosio took the reins at Sears in February 2011 at 46.

Health reasons also preceded his departure from the communications company Avaya in 2008 after two years as CEO. D'Ambrosio had been "gravely ill," but rebounded, the source said.

Before joining Avaya, D'Ambrosio worked for 16 years at IBM Corp. in executive roles in sales, software and global services.

Calls to D'Ambrosio went unanswered Monday evening.

His compensation at Sears included a $1 million base salary, a $150,000 signing bonus, $6 million in restricted stock and potential bonuses up to $2 million. Sears also paid for his charter flights between Chicago and Philadelphia, where D'Ambrosio lived.

"The board greatly appreciates Lou's strong leadership in accelerating the transformation of Sears Holdings, and we understand and respect his personal decision to step down," Lampert said in a statement. "Lou has guided Sears Holdings during a time of rapid industry change to become a more customer and Member-focused company and positioned us to lead in Integrated Retail. His contributions to our company have been significant, and the entire Sears Holdings family wishes Lou and his family the very best."

The company statement also quoted D'Ambrosio:

"It has been a true privilege to serve the customers, Members, shareholders and associates of Sears Holdings. This was a very difficult decision, but necessary for family considerations. Sears Holdings is a remarkable company going through an exciting transformation to serve its Members with excellence in Integrated Retail. I wish both the company and our talented associates much success in completing the transformation of Sears Holdings and look forward to supporting Eddie and the rest of our management team during the transition."

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