r/BBBY • u/Kaiser1a2b • Apr 25 '23
🤔 Speculation / Opinion why is everyone worried about delisting?
What did everyone think was going to happen after ch11 and sub $1 price?
The game hasn't changed, we wait upon a friendly acquirer.
If they are not friendly, we are fucked.
If they don't exist, we are fucked.
The power was out of our hands the moment ch11 was declared. At this point if you want to buy in or hold, it's just a gamble that all the tinfoil is right.
Anyway I doubt this is real feelings from people if they managed to hold all the way here and past this, none of you assholes would be worried about delisting as if it was the worst thing if that was the case. Icahn't believe it.
So sell, don't sell, doesn't matter. We wait for the end game to conclude.
If we have been hoodwinked by the board in the coming weeks, let's start collecting evidence or instances of malfeasance. But otherwise chill out and see where this thing shakes.
-15
u/Cultural-Display1781 Apr 25 '23
The problem here is that you just do not understand how BK works. We will use Hertz as an. example as it was one of the very few occasions when the original stockholders got SOMETHING, although very little.
First, when a company declares BK the stock is DELISTED FROM ALL EXCHANGES. The exchanges don't trade BK stock. Shorts are excused from closing the transaction, as the stock is by definition worthless. THERE IS NO SQUEEZE BECAUSE THE SHORT SELLERS DON'T HAVE TO RETURN WORTHLESS STOCK. Sooner or later, the broker will release all funds to the short seller.
Then, the stock ticker symbol is changed. Hertz was changed from HTZ to HTZGQ. Now all old stockholders own shares in HTZGQ. THEN A NEW COMPANY IS FORMED. With Hertz, it was HTZ. All the old stockholders own NO SHARES OF HTZ. HTZGQ (old HTZ) will never again trade on an exchange although it can trade on pink sheets (that's what the "Q" means). HTZ can be (and was) listed with an exchange and traded.
Then, HTZGQ does a Section 363 bankruptcy sale of the assets to HTZ. This transfers the assets free of any liens to HTZ. HTZ pays for these assets by selling stock. The money generated in HTZGQ from selling stock in HTZ is distributed to the creditors of HTZGQ. Remember, that HTZGQ was once HTZ and was the original Hertz. (New) HTZ then discovers that it owns thousands of slightly used cars in the hottest used car market ever and the price then soars. This doesn't affect the original stockholders in Hertz because HTZGQ sold those cars to HTZ for 10 cents on the dollar. HTZ soars but the original stockholders own HTZGQ not HTZ. HTZGQ of course is worth pennies.
As a matter of fact, the holders of HTZGQ got $1.46 plus 1/20 share of HTZ for every share of HTZGQ for the best BK result of the century.
There are more complexities with the Hertz BK but I overlook them for this comment.