4 ms·

I'm apparently stupid. I can't understand how that can be even remotely legal.

• soganess 3y ago
  I know basically nothing about this, but hear money peeps talking about it all the time like it is common practice. Some version of it happened to the B&M store Clarie's.
• taylodl 3y ago
  The company's officers are in on the take. Legally they can take these actions on behalf of the company, as long it's clear and in the open.
  • pavon 3y ago
    It is the bankruptcy part that I don't understand the legality of. Parent company pulls a ton of money out of subsidiary, claims bankruptcy, then magically parent company isn't liable for subsidiary's debt?
    • Zigurd 3y ago
      PE isn't a parent company. LBO debt is debt carried by the acquired company. So there is no sleight of hand in bankruptcy. The poison is already in the acquired company's bloodstream.
      • mikeyouse 3y ago
        Yep, all correct. The sleight of hand comes just before bankruptcy when the assets are stripped and sold to a different entity so the debtholders are screwed with worthless assets and are stuck filing longshot lawsuits to recover assets while the ghouls who raided the company invest their ill-gotten proceeds while tying the mess up in court for years. https://archive.is/LsqUp https://archive.is/LsqUp