Sears, SRG, and the Economics of Fraudulent Conveyance

Christopher M. Colorado, Edi M. Grgeta, and Konstantin A. Danilov
Journal of Corporate Renewal
November 2017

Friedman Kaplan partner Christopher Colorado, along with Edi M. Grgeta  and Konstantin A. Danilov of Analysis Group, co-authored an article in the November/December edition of the Journal of Corporate Renewal entitled “Sears, SRG, and the Economics of Fraudulent Conveyance.”

In the article, Messrs. Colorado, Grgeta, and Danilov explore the value received by Sears in a recent spin-off leaseback transaction and how that value might be viewed in the event of a Sears bankruptcy, including the potential applicability of state fraudulent conveyance law and certain valuation issues raised by discounted leaseback rates on retail property, issues frequently overlooked in discussions of the transaction.

Given that many distressed retailers use asset sales to increase liquidity in the current environment, these considerations are broadly applicable and relevant to other transactions.

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