A hearing on RadioShack Corp.’s plan to sell about 1,700 stores to its biggest shareholder is set to continue today, with the prospect of thousands of job losses if the deal falls through, Bloomberg News reported today. Standard General LP’s bid to take over the stores and run them in a co-branding arrangement with Sprint Corp. has met opposition from some creditors and been threatened by infighting among lender groups. Standard General said that jobs will be preserved if its plan is approved. Otherwise, the assets will be liquidated and stores closed. “There are over 7,000 jobs and very large business at stake,” Bankruptcy Judge Brendan Shannon said yesterday. A key issue in court is who shall be liable if lower-ranking creditors including Salus Capital Partners LLC successfully sue lenders for pre-bankruptcy actions. The unsecured creditors’ committee is investigating whether some RadioShack lenders could be held responsible for the electronics retailer’s bankruptcy.
