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Old December 17, 2017, 00:55   #11
FALaholic #: 2439
Join Date: Jan 2001
Location: up a creek in MT
Posts: 16,560
Originally Posted by Exit308 View Post
I think you're talking about Eddie Lampert. I still remember Jim Cramer expounding about what a genius Lampert was back in '04 or '05 when he was taking over those companies.
I think most of the value in those companies was in the Real Estate which he has probably 'harvested' by now.
He can now go banko and stiff everybody else.
Modern financial engineering at its best.

Bill Bonner on Sears.
How Do You Destroy a Business?

Two hedge funds swooped in with a plan: They would use cheap financing to transform valuable Main Street real estate into a Wall Street asset. They set up a real estate investment trust (REIT), took the property out of the company, and put it in the REIT.
[Note: A REIT is similar to a mutual fund, except that it is composed of property instead of stock.]

Sears can go broke; they will still have the company’s most valuable assets. And now they can sell the REIT to investors.

And by the way, one of the two funds involved is run by a former college classmate and Goldman Sachs crony of Mnuchin’s, Eddie Lampert.

Stockman continues:

…the whole deal was a backdoor financing to get assets out of SHLD [Sears] prior to its impending bankruptcy. The hedge fund insiders will now have a secured senior claim through the newly created REIT, which they substantially own, rather than worthless SHLD common stock.

At least Steve Mnuchin can do Sears no more harm. Donald Trump picked him as his Treasury secretary.

Bawana jim; 'I was trying to get to the point he would realize that because of debt the world has improved.'
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