Shares of Sears Holdings (SHLD) plummeted on Wednesday on reports that the struggling retailer is expected to file for Chapter 11 Bankruptcy Protection in a few days. Wall Street Journal reported that the company had hired investment and advisory firm M-III Partners to prepare a bankruptcy filing. The stock nosedived more than 25% before the bell on Wednesday.

On Tuesday, Sears appointed Alan Carr, Managing Member and CEO of Drivetrain, to its Board of Directors. Carr has significant experience as a principal, investor and advisor leading complex financial restructurings, as well as serving as a director of reorganized businesses in the US and Europe.

Sears has to pay $134 million of debt, which is due on coming Monday

Sears has been encountering substantial obstacles to report profitability for many years, hurt by the enormous changes in the retail environment caused by the increasing trend of online shopping. To overcome the challenges, Sears has closed unprofitable stores, liquidated inventory, and reduced headcount.

The company has been selling properties where it can obtain favorable prices and repaying the associated debt. Sears has also been seeking partners who can expand the reach of its major brand assets and reducing costs.

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Apart from these headwinds, the company has been impacted by its long-term pension obligations. The retailer has contributed nearly $2 billion in last five years and over $4.5 billion since 2005 to fund pension plans. Last month, Sears received a proposal from ESL Investments regarding certain liability management and real estate transactions.

The Hoffman Estates, Illinois-based firm has to pay $134 million of debt, which is due on coming Monday. The company has been not successful in reaching a deal with its CEO Eddie Lampert, who is also its biggest stakeholder to restructure its debts and sell assets. It is expected that Sears will not be able to pay the debt on the due date.

Sears stock, which hit a new yearly low on Tuesday, had lost 83% so far this year and 92% in the past 12 months. The stock continued to bleed in the morning trading session.

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