3 ms·
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 pare
by 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 agoPE 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 agoYep, 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