Sweden's Intrum Seeks US Bankruptcy to Finalize Restructuring
Friday, Nov 15, 2024 3:48 pm ET
1min read Swedish debt collector Intrum AB has initiated a pre-packaged Chapter 11 process in the U.S. to implement its Recapitalisation Transaction, aiming to strengthen its capital structure and position it for long-term growth. The company expects to emerge from the process with ample runway and liquidity to execute its business plan.
Intrum has secured overwhelming support from its creditors, with 100% of RCF lenders and 82% of noteholders voting in favor of the plan. The required majority for each class under a Chapter 11 plan is 66.67% in amount (of allowed claims) by class. The plan aims to cut a slice of the debt in exchange for an equity stake, with noteholders set to receive 10% of ordinary shares on a fully diluted basis.
The Recapitalisation Transaction will significantly improve and strengthen Intrum's capital structure. It will result in the noteholders receiving 10% of the ordinary shares in Intrum on a fully diluted basis, as a condition to noteholders writing down 10% of their debt holdings. The share issuance is subject to approval by the extraordinary general meeting of shareholders.
In addition to the Chapter 11 case, Intrum is intending to complete a Swedish company reorganisation during Q1 2025, to ensure the results of the Chapter 11 process are given equal effect in Sweden. The effectiveness of the Chapter 11 Plan is conditional upon, amongst other things, the consummation of the Swedish company reorganisation. The Recapitalisation Transaction is expected to become effective during Q1 2025, following the satisfaction of all conditions precedent.
Andrés Rubio, President and Chief Executive Officer of Intrum, stated, "Today, with support from the overwhelming majority of our key stakeholders, we are making significant progress towards the implementation of our recapitalisation transaction. This pre-packaged, court-supervised Chapter 11 process is a positive step for our company and will position Intrum – and all of our stakeholders – for future success."
Intrum continues to operate as normal with employees providing critical services for clients and customers. The company expects to continue to pay its financial obligations in the ordinary course of business, without interruption. The Group will remain in possession and control of its assets, retain its existing management team and board of directors, and maintain its ordinary operations in all other material respects.
In conclusion, Intrum's pre-packaged Chapter 11 process in the U.S. is a strategic move to strengthen its capital structure and position it for long-term growth. With overwhelming support from its creditors and a well-structured plan, Intrum is poised to emerge from the restructuring process with ample liquidity and a stronger financial foundation.
Intrum has secured overwhelming support from its creditors, with 100% of RCF lenders and 82% of noteholders voting in favor of the plan. The required majority for each class under a Chapter 11 plan is 66.67% in amount (of allowed claims) by class. The plan aims to cut a slice of the debt in exchange for an equity stake, with noteholders set to receive 10% of ordinary shares on a fully diluted basis.
The Recapitalisation Transaction will significantly improve and strengthen Intrum's capital structure. It will result in the noteholders receiving 10% of the ordinary shares in Intrum on a fully diluted basis, as a condition to noteholders writing down 10% of their debt holdings. The share issuance is subject to approval by the extraordinary general meeting of shareholders.
In addition to the Chapter 11 case, Intrum is intending to complete a Swedish company reorganisation during Q1 2025, to ensure the results of the Chapter 11 process are given equal effect in Sweden. The effectiveness of the Chapter 11 Plan is conditional upon, amongst other things, the consummation of the Swedish company reorganisation. The Recapitalisation Transaction is expected to become effective during Q1 2025, following the satisfaction of all conditions precedent.
Andrés Rubio, President and Chief Executive Officer of Intrum, stated, "Today, with support from the overwhelming majority of our key stakeholders, we are making significant progress towards the implementation of our recapitalisation transaction. This pre-packaged, court-supervised Chapter 11 process is a positive step for our company and will position Intrum – and all of our stakeholders – for future success."
Intrum continues to operate as normal with employees providing critical services for clients and customers. The company expects to continue to pay its financial obligations in the ordinary course of business, without interruption. The Group will remain in possession and control of its assets, retain its existing management team and board of directors, and maintain its ordinary operations in all other material respects.
In conclusion, Intrum's pre-packaged Chapter 11 process in the U.S. is a strategic move to strengthen its capital structure and position it for long-term growth. With overwhelming support from its creditors and a well-structured plan, Intrum is poised to emerge from the restructuring process with ample liquidity and a stronger financial foundation.
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