Yes, once the BK judge approves the re-org plan, they de-list to the Other OTC as PSUNQ.....at that point, the bid-ask spreads will widen, and volume will fall back to pre-BK levels. No funds will touch this going forward, since existing shares will be cancelled prior to going private. So, it will be strictly pennies flippers trading for fractional gains.
quote from this morning's article...
"PacSun said it would implement its reorganization plan through the Chapter 11 process and emerge as a privately owned company. There are 593 PacSun stores across the U.S. and in Puerto Rico that employ about 2,000 full-time workers, according to the bankruptcy filing."
The irony of this is that GCC will take PSUN public again at a future time that is opportune. You might think that GCC would offer a modest tender offer to existing common shareholders, given the low market cap, but they don't need to do this, since the re-org plan will allow them to legally cancel all commons, without spending a single dime.
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NASDAQ doesn't cancel shares, the court does. The second part is correct. Bankruptcy is an automatic delisting under NASDAQ rules. It will likely disappear on Monday and reappear on the OTC with a Q on the end of the symbol. There it will trade for 30 days or so until the court finalizes the bankruptcy. In the mean time lying scammers on this board will say anything to get people to buy their soon to be worthless shares. In the end the stock will get cancelled and a few bag holders will claim that it "was all a fraud" and that they'll be rich once their big lawsuit is won, but in the end they'll just be broke bag holders.
I'm hopeful. I jumped in before the closing bell between 0.5 - 0.6 cents. Will see what happening tomorrow and Monday.
On Thursday, Pacific Sunwear's CEO said in an open letter to customers that it intends to keep its doors open throughout the bankruptcy process and operate as usual.
"Most importantly I want to emphasize that our customers should not be affected by this restructuring process," said Mr. Schoenfeld in the letter. "Our Golden State of Mind spirit will continue to be at the core of how we work."
The deal never transpired, however, and Jos A. Bank instead agreed to merge with Men's Wearhouse Inc.
Golden Gate also reaped a healthy return on women's retailer J. Jill, which it acquired in 2009 for about $75 million. Later, Golden Gate sold a roughly 70% stake in J. Jill to Bahrain investment firm Arcapita Bank. In 2015, Arcapita and Golden Gate exited their stakes in J. Jill, selling it to private-equity firm TowerBrook Capital Partners for about $400 million. Golden Gate made a roughly five-times return on the J. Jill investment, according to a person familiar with the situation.
Under the Pacific Sunwear deal, Golden Gate will convert a chunk of the debt into equity, and invest at least $20 million into the company after it emerges from bankruptcy. Prebankruptcy lender Wells Fargo also agreed to lend a $100 million revolver after Pacific Sunwear's emergence.
Pacific Sunwear does acknowledge "several critical mistakes" made by management over the years, including the decision to no longer sell sneakers in 2008; investing in concepts, like D.e.m.o., a late 1990s concept targeted to urban audiences, and branded footwear and accessories retailer One Thousand Steps, that were eventually were discontinued; changing merchandising strategy; and selling too much inventory at a discount.
Pacific Sunwear eventually switched management and hired Gary Schoenfeld as chief executive in 2009 -- shortly after the company's performance improved as it closed 200 stores and introduced new fashion campaigns such as the widely marketed "Kendall and Kylie Collection," from the half-sisters of the Kardashians.
During this period Pacific Sunwear also secured a $60 million term loan from Golden Gate, and $100 million loan from Wells Fargo N.A.
Later in 2015, Pacific Sunwear also implemented an annual cost reduction program, which it hoped would yield about $15 million in annual savings, according to a public filing.
On Thursday, Pacific Sunwear's CEO said ....
We are up 6% in the early AH. Then we back down more than 10% in AH. Will see what happening on Friday and Monday. I'm not ready to bring out my Kleenex yet.
5:23 pm ET April 7, 2016 (Dow Jones)
By Lillian Rizzo
Pacific Sunwear of California Inc. filed for bankruptcy on Thursday with a plan that hands control over to lender Golden Gate Capital with the hope that the private-equity firm has the remedy to turn around the troubled teen fashion retailer.
The company, an Anaheim, Calif., apparel seller, says its fashions aren't the cause of its financial problems but rather its stores' costly leases at the nation's malls, where traffic has dried up in recent years. The drop in mall traffic coupled with the high rents meant the retailer wasn't able to get a handle on $160 million in debt that was slated to mature later this year.
"The problem is the rent structure," said Jeff Van Sinderen, a retail analyst at B. Riley & Co. "Other retailers have struggled with the same issue -- mall traffic is running negative. Some retailers have the brand equity but have to ask, 'does it make sense to forward with this number of stores?'"
In the last two years, a parade of teen retailers -- plagued by the slowing mall traffic, an increase in online shopping and teens spending more on electronics and athletic wear -- have filed for bankruptcy. Among those that have passed through bankruptcy court are American Apparel Inc., Quiksilver Inc., Cache Inc., The Wet Seal Inc., Deb Stores and dELiA*s Inc.
Unlike many retail outlets that find themselves in bankruptcy, Pacific Sunwear filed for chapter 11 protection with a restructuring support agreement already in place. The deal calls for a debt-for-equity swap with Golden Gate.
The San Francisco private-equity firm has a history of turning around apparel sellers.
Golden Gate acquired the retailer Eddie Bauer Holdings Inc. for $286 million in a bankruptcy-run process in 2009. By 2014 it was ready to sell Eddie Bauer to Jos A. Bank Clothiers for $875 million.
Pacific Sunwear of California, Inc. (NASDAQ:PSUN) major shareholder Adage Capital Partners Gp, L.L sold 4,822,127 shares of Pacific Sunwear of California stock in a transaction on Wednesday, April 6th. The shares were sold at an average price of $0.10, for a total value of $482,212.70. The transaction was disclosed in a legal filing with the SEC, which is available at this hyperlink. Large shareholders that own 10% or more of a company's stock are required to disclose their sales and purchases with the SEC.
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It held up pretty well today considering and had some nice buying into close.
When it rains it pours. If any of you holding are not prepared
for the DELISTING already then you better be. It's not a matter
if, but rather when. My guess is that it will happen by Tuesday.