Tuesday Morning says lenders’ actions contributed to Chapter 11

Dive Brief: In the weeks ahead of the bankruptcy filing, Tuesday Morning says its creditors, led by Wells Fargo, increased the company’s reserve requirements from $10 million to $30 million.
Link: Tuesday Morning says lenders’ actions contributed to Chapter 11 | Retail Dive

I wonder if this foreshadows what might happen to Morrison’s supermarket in the UK.

Also shows the issues of having all your debt with one institution. Similar in the UK to Paperchase (which was put into a pre-pack administration process by its main lender and taken private, with further actions to get creditor relief during the pandemic using the CVA process, and recruiting a replacement main investor; latest final administration has seen Tesco take the brand IP but not the stores)

And of course the RBS Global Restructuring Group scandal which affected a number of small retailers (vampire capitalism)

[Note: CVA–Creditors Voluntary Arrangement–closest that UK corporate law gets to US Chap 11 debtor in possession style bankruptcy protection; creditors mutually agree to debt writeoffs and changes in trading terms e.g. turnover based rent for physical stores replacing traditional multi-year leases]

1 Like

This looks more and more like Morrisons future… think @Miles_Thomas is calling this early…

And maybe Albertsons as well, if Kroger takeover goes ahead in the shape proposed, with PE loading Albertsons with a lot of debt.

1 Like