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Apr 24, 2020 at 12:01 comment added Cephalopod @vsz You asked about Investors buying a company for $1. Once you did that, it's yours. If you want to keep it, you have to pay the debts.
Apr 24, 2020 at 9:25 comment added MSalters @Mast: That's logical. Most businesses don't have much money, but do have other types of assets. Mortgage banks have mortgages. These do pay interest, which is money, but the mortgage banks will have debt of their own that need repaying.
Apr 24, 2020 at 8:26 comment added Mast "If a company has no assets and significant liabilities, it is bankrupt." It is perfectly possible to have more liabilities than money, mortgage banks are famous for it.
Apr 24, 2020 at 8:20 comment added vsz @Cephalopod : I'm not talking about "me" keeping something of "my company". I'm talking about someone who was previously unaffiliated with a company, wanting to buy it.
Apr 24, 2020 at 8:14 comment added Cephalopod @vsz In a bankruptcy, debts don't magically disappear. All assets have to be sold to repay as much debt as possible. Unless there are enough assets to repay all debts, if you want to keep even one paper clip of your company, you have to repay all the debts.
Apr 24, 2020 at 6:59 comment added vsz In this case, why are there cases of an investor buying a company (often for a symbolic price of $1) and then paying its debts out of his own money? Maybe he thinks he can use the intellectual property or just make changes which will turn the company profitable... but why not use the bankruptcy to cancel the company's debts?
Apr 24, 2020 at 5:06 comment added Flux Until 1965, American Express was a publicly traded unlimited liability company, which meant that its stockholders were responsible for the company's liabilities on a pro rata basis. It was in theory possible for the company to be worth less than nothing, and for its stock to trade at negative prices.
Apr 24, 2020 at 4:24 comment added Flux This is not applicable to companies with unlimited liability, whose stockholders are responsible for the company's liabilities, and therefore can be worth less than nothing.
Apr 23, 2020 at 14:05 comment added D Stanley Partnerships (without limited liability) and sole proprietorships have unlimited liability (owners are personally responsible for debts), but are not publicly traded (at least not in the US)
Apr 23, 2020 at 14:02 history answered ChrisInEdmonton CC BY-SA 4.0