ESL Partners’ Eddie Lampert, who is struggling to figure out how to make the merger between Sears Holdings and Kmart work, has taken a stake in another discount retailer.
The hedge fund manager who BusinessWeek once audaciously called the next Warren Buffett, took a small, $56 million stake in Big Lots in the first quarter.
Big Lots specializes in what is called close-outs—merchandise that either could not sell elsewhere or which suffered from excess production. The company has enjoyed fairly strong growth through the recession. Earnings have swelled about 46 percent over the most recent two-year period.
It also is a strategy that has fueled the success of rivals TJ Maxx and his sister chain Marshall’s.
Big Lots’ stock dropped 1.32 percent on Monday, but was up nearly the same percentage in after hours trading after Lampert filed his 13(f) with the Securities and Exchange Commission disclosing the holding.
Interestingly, in April Big Lots named Doug Wurl as Executive Vice President, Merchandising. Wurl was previously at Sears, where he was Vice President, General Merchandise Manager, Business Unit President, SHC Home Division.
In the first quarter, Lampert also closed out his position in H&R Block, which owns the largest tax preparer business as well as the tax and consulting firm, RSM McGladrey.
Lampert also said he had $10.6 billion invested in 10 stocks, including Sears, by far his largest holding, as well as Autozone and AutoNation, his other two long-time substantial positions.
At year-end, he had $9.2 billion invested in 10 stocks.
