RadioShack’s deal with the winning bidder of its bankruptcy auction, hedge fund Standard General LP, is being challenged by Salus Capital, the retailer’s top creditor who lost the auction. It’s another complication for the already troubled electronics company.
In a hearing in a Delaware bankruptcy court Thursday, second tier lender Salus said the auction was a charade and “fundamentally unfair,” calling for the judge to reopen bidding, according to court filings. The private three-day auction raised money that will pay back RadioShack debt holders.
RadioShack, on its part, is requesting the judge, Brendan Shannon, approve the Standard General bid, considered by its fellow lenders to be the only deal that could save RadioShack.
