Corporate Bankruptcies....

[Flying_Lavey]

Has anybody noticed that corporate Bankruptcies are skyrocketing lately? I literally see a new headline company filing for chapter 11, 13, or 7 at least 2 to 3 times a week for the last 2 months. I looked it up and found a Bankruptcy Watch website that shows a scary trend. Specially with Chapter 11's. They are THROUGH THE ROOF YoY.

Bankruptcy Data & Statistics (Updated September 17th, 2024)

Real-time bankruptcy statistics to help you make better business decisions, faster. Industry market research reports, statistics, analysis, data, trends, and more.

www.bankruptcywatch.com

 

[angiebaby]

Nonsense. Everything is rosy. Fastest growing economy ever. Low unemployment, inflation is under control, stock market record highs, etc, etc, etc.

Why ya gotta be a Debbie Downer??

 

[TimeBandit]

Or are they strategic bankruptcies?

You know the kind that screw the little guy they owe money to while the shell corporation protects the real money from damages.

 

[Flying_Lavey]

Or are they strategic bankruptcies?

You know the kind that screw the little guy they owe money to while the shell corporation protects the real money from damages.

This is all types. I can't remember which one is which though.

 

[RiverDave]

The hoonigan / wheel pros deal is wild..

 

[regor]

Tupperware files for bankruptcy amid slumping sales

Tupperware and some of its subsidiaries have filed for Chapter 11 bankruptcy protection, the once-iconic food container maker said in a statement.

www.cbsnews.com

 

[EmpirE231]

Most likely due to not being able to restructure their debt at a low rate. Most of these big corporations restructure / refinance their debt every 5 yrs or so, and with rates being significantly higher.... = more BK's

throw in economic slowdown and you get more of this

 

[Chili Palmer]

Tupperware files for bankruptcy amid slumping sales

Tupperware and some of its subsidiaries have filed for Chapter 11 bankruptcy protection, the once-iconic food container maker said in a statement.

www.cbsnews.com

Tupperware is expensive, can’t be microwaved, or have spaghetti sauce put in it without staining. I can do that with all sorts of Ziploc or Gladware disposable containers for a fraction of the price of Tupperware. I didn’t even know Tupperware was still around.

 

[Gonefishin5555]

All those corps with covid SBA loans with no personal guarantees are gonna start going under. Why bother paying it back when you can BK and form another company

 

[DarkHorseRacing]

Tupperware is expensive, can’t be microwaved, or have spaghetti sauce put in it without staining. I can do that with all sorts of Ziploc or Gladware disposable containers for a fraction of the price of Tupperware. I didn’t even know Tupperware was still around.

Doesn’t Tupperware have a manufacturing plant in LHC? Or some kind of warehouse/office building?

My neighbors wife worked there (or it could be a similar company in LHC).

 

[79 HUSTLER]

Doesn’t Tupperware have a manufacturing plant in LHC? Or some kind of warehouse/office building?

My neighbors wife worked there (or it could be a similar company in LHC).

No, we have Sterlite.

 

[DarkHorseRacing]

No, we have Sterlite.

Yeah that’s it. Thanks!

 

[CLCookie]

Free money has gone away, all that extra money in the economy kept a lot of companies afloat. Also gave those companies a false hope that they were doing everything ok. Then add in Inflation, more debt and people getting laid off..........we are only seeing the beginning.

 

[gqchris]

 

[BingerFang]

All those corps with covid SBA loans with no personal guarantees are gonna start going under. Why bother paying it back when you can BK and form another company

Pretty sure SBA requires PG on all loans. @ChumpChange will know for sure.

 

[angiebaby]

All those corps with covid SBA loans with no personal guarantees are gonna start going under. Why bother paying it back when you can BK and form another company

Most never had to pay it back from what I understand. That's why you saw so much money floating around and people (businesses) purchasing toys. They got them from taxpayers and the fed printing money, which caused the inflation we are all facing today. We all paid for it in the long run.

 

[angiebaby]

Pretty sure SBA requires PG on all loans. @ChumpChange will know for sure.

Ours did.

 

[lbhsbz]

These don't concern me because many are by design. Investors buy companies and dismantle them, destroy the lives of the employees, fuck up the whole market that the company catered too, and file BK to somehow make it all legal....while a handful of people get to count their money and the rest of the people get fucked.
I wouldn't put much merit in what you're seeing....it's all smoke and mirrors

The corporate debt thing always makes me scratch my head....if the company was worth a shit, why do they have debt past credit card debt that gets paid every month? They take on debt to get bigger quickly, and use that bigger revenue to pay the loan...whats the point? Why not grow within your means with no debt?

A company that brings in $100M/year with $50M in debt has about zero value

 

[angiebaby]

These don't concern me because many are by design. Investors buy companies and dismantle them, destroy the lives of the employees, fuck up the whole market that the company catered too, and file BK to somehow make it all legal....while a handful of people get to count their money and the rest of the people get fucked.
I wouldn't put much merit in what you're seeing....it's all smoke and mirrors

You don't think that would have some sort of ripple effect?

 

[Parker Dreamin]

The hoonigan / wheel pros deal is wild..

Agree - and the sell off of 4WP back to Adler - he made out big time on that one.

 

[Floaterboat]

The hoonigan / wheel pros deal is wild..

If you look at the filing, it’s not wild at all. Textbook private equity.

 

[Floaterboat]

Agree - and the sell off of 4WP back to Adler - he made out big time on that one.

That was from Polaris, but That one was a good one.. right place, right time, right buyer.

Buy.com had a similar story 25 years ago.

 

[lbhsbz]

You don't think that would have some sort of ripple effect?

Everything has a ripple affect, but this isn't the big corp failing due to market changes or consumer confidence changes....this is the shareholders using BK as a tool to make money. If the first one was true...I'd be holding onto my hat....if the second one was true, I'd be looking for a new job at a smaller company not run by private equity shitbags.

 

[BingerFang]

These don't concern me because many are by design. Investors buy companies and dismantle them, destroy the lives of the employees, fuck up the whole market that the company catered too, and file BK to somehow make it all legal....while a handful of people get to count their money and the rest of the people get fucked.
I wouldn't put much merit in what you're seeing....it's all smoke and mirrors

The corporate debt thing always makes me scratch my head....if the company was worth a shit, why do they have debt past credit card debt that gets paid every month? They take on debt to get bigger quickly, and use that bigger revenue to pay the loan...whats the point? Why not grow within your means with no debt?

A company that brings in $100M/year with $50M in debt has about zero value

Debt (leverage) when used correctly can expontially help a business grow much quicker than it could with the support of its own cash flow. Just like everything else, too much will kill ya. Quick.

 

[ChumpChange]

Pretty sure SBA requires PG on all loans. @ChumpChange will know for sure.

Yes they do. In reference to who you quoted and his reference of PPP loans, most of those were forgiven anyway and no longer exist.

 

[Ace in the Hole]

Has anybody noticed that corporate Bankruptcies are skyrocketing lately? I literally see a new headline company filing for chapter 11, 13, or 7 at least 2 to 3 times a week for the last 2 months. I looked it up and found a Bankruptcy Watch website that shows a scary trend. Specially with Chapter 11's. They are THROUGH THE ROOF YoY.

Bankruptcy Data & Statistics (Updated September 17th, 2024)

Real-time bankruptcy statistics to help you make better business decisions, faster. Industry market research reports, statistics, analysis, data, trends, and more.

www.bankruptcywatch.com

In my industry it’s an every day occurrence… The administration likes to praise the IRA while in reality it was the worst piece of legislation to ever hit the solar industry.. Coupled with high interest rates, a lack of debt buyers, and worsening utility policy/metering agreement it’s been a disaster.

 

[ChumpChange]

A company that brings in $100M/year with $50M in debt has about zero value

It has no value? So I can turn that debt twice a year? Sounds good to me. I’d love to have companies on my books that can pay their debt off in six months.

 

[DWC]

In my industry it’s an every day occurrence… The administration likes to praise the IRA while in reality it was the worst piece of legislation to ever hit the solar industry.. Coupled with high interest rates, a lack of debt buyers, and worsening utility policy/metering agreement it’s been a disaster.

The metering changes have got to be brutal. The ROI calcs went from “no brainer” to not until rates go even higher. A couple more in Havasu and we may be back.

 

[Ace in the Hole]

The metering changes have got to be brutal. The ROI calcs went from “no brainer” to not until rates go even higher. A couple more in Havasu and we may be back.

I am looking to get out of the industry sooner than later. I still do some solo solar projects at the moment, but I resigned from my role as COO of an EPC last month. The company I was with’s ownership refused to see the writing on the wall and adapt. I didn’t want my name on the wall when there was a bankruptcy which is inevitable for them by probably January.

 

[RVRKID]

That was from Polaris, but That one was a good one.. right place, right time, right buyer.

Buy.com had a similar story 25 years ago.

Kingston Technologies also:
Thu 15 Jul 1999
Four years ago, the founders of Kingston Technology sold 80 per cent of their business to Softbank, raking in a cool $1.8 billion in the process. When we met the founders at Comdex/Fall, they looked very happy indeed with this result. Perhaps they had an inkling that the very next year the memory market would take the dive it has. And now Softbank has decided to sell the 80 per cent share back to the founders for $450 million. So we expect that they're looking exceedingly happy again. Softbank's reasoning, according to the WSJ, is that it wants to concentrate on the lucrative Internet market.

 

[shintoooo]

Pretty sure SBA requires PG on all loans. @ChumpChange will know for sure.

With reference to the covid EIDL SBA loans, they didn't require a personal guarantee for anything under $200K. Anything over that, it required a personal guarantee. I'm not sure if there will be any consequences if you just stop paying and your loan is under $200K. I had two previous clients close shop and they just stopped paying. They had $150K loans. I think we're going to see A LOT more of that coming soon.

Here's some more info: https://www.sba.gov/funding-program...ster-loan/about-covid-19-eidl#id-loan-details

Am I Personally Liable For An EIDL Loan?

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https://www.reddit.com/r/EIDLPPP/comments/1d8vuzy