Comment by johngladtj
2 years ago
Yes, I did.
Sale-leasebacks are common and perfectly reasonable business strategies.
Generally speaking lease liabilities have a lower cost of capital than other types of debt, so making such a deal can help the company.
None of the decisions described in the post are either unusual or unreasonable from a management team trying to save a troubled company. They were just unsuccessful.
>>> from a management team trying to save a troubled company. They were just unsuccessful.
My take is that they were not there to save the company, but to extract all its assets and let it go.
Sometimes that's the best option.
For who? Was that the best option for the employees who relied on the income? Or the customers who enjoyed the food? There are plenty of actions that are rational from an economics standpoint as long as you don't care about any of the externalities such as human dignity.
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