Thread regarding Sears layoffs

@1uch

Yep. Creditors won’t get squat. Eddie’s inventory light has left the stores too empty of merchandise, liquidators wouldn’t make enough outbidding him. Meanwhile he’s got financing lined up for after he wins to restock the stores. The most critical vendors have been paid or will be paid if he wins, so they won’t want liquidation, and they’ll be ready to ship more merchandise once he takes over.

The whole thing is too complex to wrap up in two or three weeks, the allegations hard to prove, the Jidge is likely going to hand over the keys to the kingdom and let the rest be litigated. Most of it will take ages in court like the GM bankruptcy profiting lawyers and no one else.

Sears w8ll become whatever Eddie wants as a private company until he runs out of money, shuts them down or turns a profit,

@hmy

None of these are long term loans. They’re mostly short term things, like vendors who foolishly shipped on credit, waste disposal, at least a part of the credit revolver, and anyone else who provided goods/services to Sears without being paid upfront. Most if not all of these loans were extended within the past 36-48 months or so,(ie. AFTER the SRG, SHOS, and LE transactions were completed) not years or decades ago. Those loans are secured, these are not. These creditors are screwed no matter what. If Eddie takes over, they don’t get paid. If they succeed and force liquidation (not likely), they have an even lower chance of getting paid because ESL is probably overpaying for the assets, even excluding the credit bid. If they manage to prove Eddie did violate the law (hard enough to do that the risk/reward isn’t worth it), then they will become liable to their own shareholders for malfeasance in failing to do due diligence before lending to Sears.

In the end, they’re unsecured and knew that going in. Because of that, their arguments are going to be taken in that light by the judge. In the end, this will be litigated between the UCC and ESL/SHC for years, with the end result remaining that nobody outside of the attorneys gets paid.

He will be in all intro to business 101 texts as another T Boone Pickens. As a scurrilous corporate raider. And sadly and ironically as a dad his actions will affect his children though I pray not. Perhaps his children are the reason for the bail-out.

@neg unsecured creditors is everyone Sears owes money to. Even the laid off guy who never got reimbursed for gas.

Personally if I lent a guy 10,000 to run a business, and he blew it on h--kers and blow, I'd be pretty p-ss-d too.

Sorry but I think you are confusing creditors with stockholders and the BoD.

In the instant case, the note came due in October 2018. They didn't have an opportunity to refuse to lend before then, and the cash had been funneled into places like Seritage, Lands End, and ESL in the intervening years. It's the same with the vendors, landlords, lessees, and taxing authorities. It takes as long as 9 months from shipment to payment, and the creditors in every instance got screwed, whether they were school boards, or dentists, or the mom making purses, or the guy running the pizza shop, pensioners, or the utility company. Eddie screwed them all with method, calculation, and deliberation, often using lawyers to do so.

Their financing of Sears occurred years in the past, like decades ago, and when they come due, they roll it over because Eddie sure as hell didn't keep the cash on hand to pay it off after putting it in his own pockets. It's like when you take a 30 year mortgage on a house. AT&T has loans that aren't due until the 22nd century.