Someone said that if market cap falls below 1 billion then liens spring into action to start liquidation. Is this true? We are getting very close.
Concerned Citizen
4 replies (most recent on top)
If creditors seize owned real estate, its a no brainer. However, with close to 1000 leasehold interests. Does company walk after BK or elect to continue to pay rents, etc. ?
If they elect to hold leases, where is money coming from to service leased properties? Just a thought.
the the pension fund could if they wanted to but they may take the view that they will get the assets in a bankruptcy in any case- i would assume eddie has said he will sell the assets and give them the cash now although i think there have been no bidders- if the pbgc believe that a bankruptcy would damage the brands then they may take them and sell them now. Either way its over for sears. Of more significance os that unlike in the past bruce and eddie have given up buying the stock to prop it up- that tells you everything you need to know.just like when in the 3rd quarter eddie has not stepped up to lend money like he did last time- he knows its over.
Not exactly. The PBGC could start seizing "fenced off" assets if SHLD falls below the one billion market cap, however, there is no mandate that they do so. Even if the PBGC did choose to seize assets that would not necessarily lead to a liquidation of the company. There are a lot of "what ifs" with this scenario and only time will tell on how it turns out.
Unlikely to occur immediately but PBGC can initiate proceedings - only 9 cents to go