Shopko used borrowed money to pay dividends; owes Wisconsin $13 million in taxes, fees [View all]
GREEN BAY - Shopko borrowed $179.5 million from lenders to pay dividends to Sun Capital Partners, its private equity owner, and other investors between 2007 and 2015.
The retailer's payments to Sun Capital, which bought Shopko for $1.1 billion in 2005, were disclosed as part of an ongoing investigation into transactions that could give rise to claims of conflicts of interest as Shopko's bankruptcy case moves forward.
The findings of the investigation, led by two independent board members appointed by Shopko in November 2017, threaten to undermine some creditors' support for Shopko's bankruptcy reorganization plan just as its parent company, Specialty Retails Shops Holding Corp., is preparing to solicit proposals from buyers and investors.
The independent directors, referred to in bankruptcy filings as the Special Committee of Independent Directors, will determine whether Shopko might have claims against Sun Capital related to the dividend payments.
Read more: https://www.jsonline.com/story/money/2019/03/01/shopko-dividends-under-investigation-also-owes-wisconsin-13-5-million/2906336002/
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