Sep. 8 at 4:23 AM
$BINI
BINI has a tough decision to make when they file bankruptcy— Chapter 7 or Chapter 11.
Chapter 7 is easy and cheap. They just file Chapter 7 then turn over the keys to the bankruptcy trustee and walk away. There is a huge risk in doing that. Once they file Chapter 7, the current management will no longer have control over the financial records or the path of the liquidation. Given all their misleading PRs in the past, it’s possible that the bankruptcy trustee could turn up fraud, even though they’ve been careful to cover their tracks.
Chapter 11 is expensive and requires much more effort on the part of the current management. On the other hand, management still has substantial control over the wind down process and any past fraud can be much more readily concealed.
My guess is that they go the Chapter 11 route because their risks are too high with Chapter 7.
