Column: The Tops bankruptcy is a lesson in leverage

In February, Tops Holding II Corp. (Tops II) and its operating subsidiaries (collectively the Tops Companies) filed Chapter 11 bankruptcy petitions in the Southern District of New York. Tops II, owned by a local group of executives, had purchased the stock of Tops Companies in late 2013. In consideration, Tops II paid approximately $21 million. However, at the time of the purchase, Tops Companies were encumbered by borrowings of over a half-billion dollars, engineered by their prior owner, a Morgan Stanley private equity entity (Morgan Stanley Group).