Sears Holdings could escape its brush with annihilation after the retailer's chairman and largest investor prevailed in an auction for a shrunken version of the company.

The owner of the Sears and Kmart chains will be sold to hedge fund manager and longtime Sears backer Eddie Lampert's ESL Investments if a judge signs off, according to a person familiar with the auction results.

The deal would prevent Sears from liquidating the rest of its stores. Lampert's initial offer for the company involved keeping about 425 stores open and 50,000 workers employed.

Sears and ESL declined to comment.

Certain Sears creditors are expected to object to the deal, and a federal judge must still decide whether it's the best outcome of the company's Chapter 11 bankruptcy.

A committee of unsecured creditors, including mall owners, has accused Lampert's hedge fund of unfairly structuring past transactions with Sears to benefit itself. That matter could complicate the deal.

Lampert has defended himself, saying he was "fighting like hell" to keep Sears alive. His recent offer for Sears was valued at more than $5 billion, including the assumption of certain liabilities, according to ESL.

Now that the auction is over, other deadlines loom. According to a timeline established earlier in the bankruptcy proceedings, objections to the sale were scheduled to be filed by the afternoon of Jan. 24, or eight days after the filing of the auction's results. A sale hearing was set for Feb. 1.

Sears has closed hundreds of locations in recent months and years, and those closures won't be reversed even if the retailer lives on.

Analysts have remained pessimistic about Sears' long-term chances of a turnaround. The company has struggled for years with digital and physical competition, tired stores and pension costs.

"While there is no doubt that a shrunken Sears will be more viable than the larger entity which struggled to turn a profit, we remain extremely pessimistic about the chain's future," Neil Saunders, managing director of GlobalData Retail, wrote Wednesday.

"In our view, Sears exits this process with almost as many problems as it had when it entered bankruptcy protection. In essence, its hand has not changed, and the cards it holds are not winning ones."

Follow USA TODAY reporter Nathan Bomey on Twitter @NathanBomey.