Monday, September 22, 2014

Story: "RadioShack in Talks With Supplier to Ease Restructuring" $RSH

The story:

"RadioShack, the electronics retailer trying to avoid bankruptcy, said it's holding talks with a 'major vendor' that could help the company restructure its finances.

The negotiations involve some of RadioShack's largest creditors, the Fort Worth, Texas-based company said today in a regulatory filing. While no agreement has been reached, the talks are continuing, the retailer said.

'The company continues to explore how to optimize its various commercial relationships,' RadioShack said. 'There can be no assurances that any such discussions will result in modifications to the company’s commercial arrangements.'

'I take this as a very bad sign,' Anthony Chukumba, an analyst at BB&T Capital Markets in New York, said today in an interview. 'They said, 'We want better terms so we don’t have to go bankrupt,' and the vendor said no.'


Anonymous said...

How does the CDS term structure look?

Can they make it through the year end Holiday season?

Anonymous said...

ALCS filed an ugly 10-Q today. Looks like you may have another potential retail bankruptcy to follow.

jHurt said...

$325M notes, 6.75% interest (semi-annual) next payable on November 15th, guessing trigger point for CH11 filing is December 15th (30 day waiver on interest)?

jHurt said...

That at the latest...last year inventory and AP both went up roughly $100M from Q3 to Q4. Have a hard time believing vendors would let payables grow $100M this time around ahead of a default that likely makes them pari with bonds already at 40 cents on the dollar

CP said...

Yes, the unsecured pmt is a good potential catalyst.

Anonymous said...

Odd 13D from Standard General today.

jHurt said...

Shorted calls today but man these guys (Standard General) are aggressive.

Wouldn't buying the notes be a better 'option' than spending $2-300K on Jan'16 calls? That part really didn't make sense to me.

"The Reporting Persons hold options to acquire an aggregate of 3,000,000 shares of Common Stock at a price of $1.50 per share, which options expire in January 2016."

CP said...

The Jan 16 calls: for a few hundred k, they got everyone to think that they think that the stock could be worth more than $1.50!