Although it is normal under Chapter 11 proceedings for shareholders to get a share of company’s assets only after the claims of a company’s creditors have been satisfied, the Winn-Dixie case sets a precedent that could be detrimental to equity investors more generally in the US.
The shareholder panel was disbanded in mid-January by Elena Escamilla, from the Justice Department’s Office of the US Trustee, leaving the official committee of unsecured creditors as the only court-authorized group involved in the Chapter 11 discussions.
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