Will Spiegel Inc. re-emerge from bankruptcy or has it reached the final countdown on its existence?
In filing its Form 8-K last week, it outlined several factors that “raise substantial doubt about the company's ability to continue as a going concern.” Further, the report said that Spiegel “may sell or otherwise dispose of assets and liquidate or settle liabilities for some amounts other than those reflected in its consolidated financial statements.”
Spiegel spokeswoman Debbie Koopman downplayed the significance of the language in the 8-K.
“[The] 'raise substantial doubts' [language] is not new news,” she said. “With any company's SEC filings, while they're in bankruptcy, you will see that type of language. Until we have a plan of reorganization, there [are] a number of possibilities. Our focus is on emerging from Chapter 11. The company is working with the creditors committee.”
She said the company continues to focus on developing a reorganization plan and improving its cash position.
“We have over $210 million in cash as of Jan. 3, so the company has strong liquidity and a good cash position,” she said.
The 8-K stated that though the company expects to file a reorganization plan, such a plan may include “the sale of significant assets and/or subsidiaries.”
“Since filing for protection under Chapter 11 of the Bankruptcy Code, the company has experienced a decrease in assets, an increase in liabilities (including liabilities subject to compromise) and continued decreases in sales and revenues resulting in an increase in loss from continuing operations,” according to the 8-K.
