(Reuters) - Sears Holdings Corp's SHLD.O shares tumbled as much as 16 percent on Wednesday as bondholders and investors questioned how long the storied retailer could remain in business after it flagged doubts that it could continue as a going concern.

A Sears department store is pictured in La Jolla, California, U.S., March 22, 2017. REUTERS/Mike Blake

For several years, the parent of Sears, Roebuck and Co and Kmart has taken on big losses, closed stores and divested businesses as it faced stiff competition. A changing retail landscape in which many brick-and-mortar retailers have gone bust and e-commerce has boomed has also plagued the retailer.

The warning on Tuesday added a new element of uncertainty for a company that has $13.19 billion in liabilities and said it could have difficulty obtaining merchandise from vendors. Bondholders are watching to see whether Sears will have the cash and credit needed to stock its shelves for the crucial 2017 holiday season.

Sears Chief Financial Officer Jason Hollar wrote in a blog post on Wednesday that the company had boosted its liquidity by up to $1 billion through loan agreements and amended an existing credit facility to provide an additional $250 million, among other steps to improve performance and finances.

“As 2016 proved to be another challenging year for most ‘bricks and mortar’ retailers, our disclosures reflected these developments,” Hollar wrote. “While historical performance drives the disclosure, our financial plans and forecast do not reflect the continuation of that performance.”

Many question the company’s chances for survival, however. Sears last turned an annual profit in 2011.

“The retail industry is just too competitive, the brand value of Sears has diminished dramatically, the seismic shifts in consumer spending both in terms of the move to e-commerce and to experiences don’t bode well for Sears,” said Ken Perkins, president of industry research firm Retail Metrics. “We have seen a spate of Chapter 11 filings in recent months, and it is difficult to see how Sears avoids the same fate.”

Shares of Sears were down 11.9 percent at $8.02 in late afternoon after falling to $7.60, their largest one-day percentage decline since an 18.79 percent drop on Nov. 16, 2012.

THE FATE OF AN AMERICAN RETAIL ICON

Sears, Roebuck and Co - and its famed catalog - was once an American retailing icon. The company traces its origins to 1886, when Minnesota railroad station agent Richard Sears bought an unwanted shipment of watches, then sold them “at a nice profit,” according to the company’s website.

The company was also a mail-order pioneer, selling a wide variety of goods to farmers and others in far-flung rural areas. By 1895, its 532-page catalog’s offerings included a treasure trove of offerings. It was not until 1925 that Sears opened its first retail store - and that was an experiment, according to the website.

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But keeping up with the times has been costly as nimbler competitors, internet shopping and empty malls have taken a toll and the company has had to restructure. Some analysts and industry experts wonder if the efforts can pull it out of its current situation.

“They would need to make so many cost cuts, the business wouldn’t exist anymore,” said Neil Saunders, managing director of retail at research firm GlobalData. “They can’t make all of those cuts because they have lease obligations and contractual obligations. The business is fundamentally broken. Its liabilities outweigh its assets.

“The only way it could survive is enter bankruptcy protection and have a fundamental restructuring, which would be extremely painful,” he added. “There’s no other option.”

The company has been controlled by its billionaire chief executive, Edward Lampert, who has cut U.S. stores by nearly a third, reduced holdings in Sears Canada and spun off the Lands’ End clothing chain. The company has also placed some of its stores into a real estate investment trust, sold its Craftsman line of tools and repeatedly raised debt from Lampert’s hedge fund.

“This revelation in their annual report that they may not be able to continue as a going concern is really just another step towards what is inevitably going to be a financial collapse,” said Mark Cohen, former CEO of Sears Canada and director of retail studies at Columbia Business School.

BLOW TO LAMBERT

The news is a blow to Lampert, who took command of Sears after merging it with Kmart, which he controlled, in 2004.

Lampert owned nearly 10 percent of the REIT that paid Sears $2.6 billion in 2015 for the stores it purchased, many of which were then leased back to the retailer.

The company had said that actions taken to boost liquidity, including the Craftsman sale to power tool maker Stanley Black & Decker Inc SWK.N, could satisfy its capital needs for the current fiscal year.

But in a filing on Tuesday it also makes clear that additional asset sales could prove problematic.

As part of the Craftsman sale, Sears Holdings reached an agreement with the Pension Benefit Guarantee Corp that puts a claim on some assets to protect pensions of retired employees.

The agreement “contains certain limitations on our ability to sell assets,” the company said.

Already, the pension board agreement requires Sears to make a $250 million cash payment to its pension plan by March 2020, and the pension board has a 15-year lien on revenue owed to Sears from future sales of Craftsman products.

As the 2017 holiday season nears, Sears will need cash. Retailers typically book orders for merchandise for the vital fourth quarter from now through midsummer.

The company said continued operating losses could restrict access to new funds under its domestic credit agreement. (bit.ly/2mRUcce)

Since 2012, Sears’ annual revenue has fallen 47 percent to $22.1 billion, and the company has posted $10.54 billion in losses, including $2.22 billion in the year ended Jan. 28.

The company has $286 million in cash on hand, down from $609 million in 2012. At the same time, receivables, which retailers in distress often use to fund operations, fell to $466 million from $635 million.

Saunders said Sears would probably have a hard time meeting its obligations as the year progresses.

“It’s going to add more debt, use more of its debt facility,” he said. “It’s going to be in a very, very difficult position, unless they find some other asset they can quickly liquidate and sell to keep the business going.”