Lampert Stays Aggressive Amid Downturn

Ed Lampert remains acquisitive in the face of a downturn that has whacked holdings in his once-winning portfolio.

The Greenwich, Conn.-based hedge fund maven has a fresh stake in home improvement retailer Home Depot (HD), and he added to his position in the banking behemoth Citigroup (C), according to regulatory filings made public on Thursday.

Like Lampert himself, both companies have been recent victims of turmoil in the U.S. housing market. Home Depot and Citigroup have both fired their CEOs and changed strategy, but Lampert, undeterred, is only getting more aggressive.

Shares of his retail empire, Sears Holdings (SHLD), have lost a third of their value since the beginning of June. Euphoria on Wall Street over the hidden value of the company's real estate assets has died down as the real estate market has gone south. Also, the retailer's sales declines have steepened as consumer spending gets squeezed by the housing crunch.

Lampert presides at the Sears as chairman having cobbled it together by using Kmart to acquire Sears Roebuck in 2004. His fund, ESL Investment Management, owns roughly 46% of the company's shares outstanding. It added to its stake in July, according to filings with the Securities & Exchange Commission.

Meanwhile, the fund acquired a stake in Citigroup through an entity called RBS Partners in the first quarter of 2006. Lampert's acquisition, though modest in relation to the company's total outstanding shares, was embraced as a potential catalyst for change as calls went out on Wall Street for the scalp of its CEO, Chuck Prince.