WHITE PLAINS, N.Y. — This past week a federal judge approved a last-minute deal to save Sears Holdings in much smaller form, giving the retailer a second chance.

Judge Robert Drain okayed a deal to sell the major remaining assets of Sears to its chairman, largest shareholder and former chief executive office Eddie Lampert’s hedge fund, ESL Investments.

Hours before Drain announced his decision, attorney Ray Schrock, who represents Sears, noted the gravity of the moment as closing arguments began. “Today is obviously a very importan day for Sears,” he said to Drain. “The fate of Sears is going to be in the court’s hands.”

Putting Sears’ plight in the broader context of the entire retail industry, which has been disrupted by forces ranging from Amazon to the rise of fast fashion, Schrock said, “like so many retailers, it’s a melting ice cube, and the timing is urgent.”

As sales continued to shrink over the last roughly 15 years, Sears has closed more than 3,500 stores and cut about 250,000 jobs, leading to the company’s Chapter 11 bankruptcy filing in October.

Without approval of the sale to ESL, Sears would have almost certainly liquidated altogether.

Instead, about 425 stores and 45,000 employees will be transferred to ESL.

“The execution risk for this transaction, when one considers the alternative … is reasonable to take,” Drain said.

Although the company will survive, store closures are not expected to stop altogether.

Both Sears and Kmart employees expressed “a sigh of relief” and “grave concern” in a statement released on their behalf soon after the deal was approved.

While Lampert’s ESL will obtain ownership of the company’s 425 remaining locations, ESL president Kunal Kamlani testified Wednesday that about 156 are not performing well.

Under the deal, ESL would offer $5.2 billion including an $885-million cash payment. It will also assume $1.3 billion of liabilities including customers’ warranties and paying off $621 million of senior debt.