The Associated Press reports that when Kmart Corp. emerges from bankruptcy protection, an event now scheduled to happen before the end of April, the company’s shareholders are almost certain to elect a new board of directors, as well as cancel its current stock and reissue new shares to creditors as compensation for bankruptcy claims.
Kmart sought bankruptcy protection one year ago today. Since then it has announced the closing of more than 600 stores, eliminated almost 60,000 jobs, and the company has been delisted from the New York Stock Exchange.
The new board is considered a critical part of Kmart’s post-bankruptcy existence; BusinessWeek said the old board was one of the worst in America last October, blaming it for ignoring the company’s troubles and handing out some $28 million in loans to executives that did not require repayment.
However, getting a qualified and independent new board may not be that easy, since the company’s troubles have been highly publicized and there remains doubt in the investor community about whether Kmart can survive even after reorganization.
Kmart sought bankruptcy protection one year ago today. Since then it has announced the closing of more than 600 stores, eliminated almost 60,000 jobs, and the company has been delisted from the New York Stock Exchange.
The new board is considered a critical part of Kmart’s post-bankruptcy existence; BusinessWeek said the old board was one of the worst in America last October, blaming it for ignoring the company’s troubles and handing out some $28 million in loans to executives that did not require repayment.
However, getting a qualified and independent new board may not be that easy, since the company’s troubles have been highly publicized and there remains doubt in the investor community about whether Kmart can survive even after reorganization.
- KC's View:
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We’d like to volunteer to serve on Kmart’s post-bankruptcy board. We’re independent, we know a little something about retailing, and we’re highly focused on the idea that after Kmart settles down the nervous stomachs on Wall Street, it must attack its relationship with consumers.
Seriously. We’d be terrific.
