Tag Archives: Company Debt Restructuring

BHP, Vale Samarco JV filed for Brazilian bankruptcy protection | Instant News


FILE PHOTO: Brazilian mining company Vale SA logo seen in Brumadinho, Brazil January 29, 2019. REUTERS / Adriano Machado / File Photo

RIO DE JANEIRO (Reuters) – Samarco Mineracao SA, a joint venture between Brazilian miner Vale SA and BHP Group Ltd, has filed for bankruptcy protection to prevent creditor claims from affecting its operations, Vale said in a securities filing Friday.

The collapse of the dam at the Samarco mining complex in 2015 killed 19 people and severely polluted the Doce River with mining waste, one of Brazil’s worst environmental disasters. The facility, which resumed production in December, was the focus of significant litigation from bondholders with nearly $ 5 billion in debt.

“The filing (judicial reorganization) is needed to prevent ongoing legal action … from affecting Samarco’s ability to produce, send, receive for its exports and to fund normal activities,” the company said.

Vale said the filing for bankruptcy protection would not affect Samarco’s ability to pay compensation to those affected by the 2015 dam explosion. It said negotiations outside the court with creditors had slowly failed over time.

The court reorganization request, filed in the state of Minas Gerais, is roughly similar to the United States’ Chapter 11 bankruptcy filing.

Samarco has $ 4.7 billion in financial debt from unrelated parties, Vale said. In the years following the Samarco disaster, Samarco has negotiated with creditors to reach a restructuring agreement. However, those talks slowed down in 2019 following changes to dam regulations in Brazil, which materially affected operations at Samarco, Vale said.

In 2019, another dam exploded at the Vale mine in Brazil, killing some 270 people and prompting tightening of rules governing mining dams.

Most of the debt is now held by “investors active in distressed asset markets,” rather than original bondholders at the time of the disaster, Vale said.

Reporting by Gram Slattery; Edited by Christian Plumb and Will Dunham

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Italy guaranteed Greensill’s loan worth 86 million euros to steel company Gupta, the filing said | Instant News


LONDON, March 19 (Reuters) – The Italian government guaranteed an 86 million euro ($ 102 million) loan from Greensill Bank, part of the collapsed Greensill Capital group, to one of the companies of steel magnate Sanjeev Gupta, according to accounts filed with the Italian firm. the registry in the last few weeks.

The company, Liberty Magona SRL, secured guarantees from SACE SpA, Italy’s state-controlled export credit agency, for loans under measures to help the company deal with the coronavirus crisis, according to Liberty Magona’s account for the period from January 1, 2019 to June 30, 2020 which includes post-year event material information.

Piombino-based Liberty Magona, which makes galvanized steel, said the three-year loan was taken out in late August last year to bolster its finances at a time of weaker demand for its products due to the pandemic.

Italy’s Ministry of Economy and Finance did not immediately respond to a request for comment. The GFG Alliance and Greensill declined to comment on the loan.

The German financial regulator has filed a criminal complaint against Bremen-based Greensill Bank.

The Greensill Capital Group filed for bankruptcy protection in the UK and Australia this month, citing a $ 5 billion exposure to the GFG Alliance of India-UK entrepreneurs Gupta. It is said that the Gupta company began failing to fulfill its obligations.

GFG, an umbrella company for the steel, aluminum and energy company network Gupta, said last week it wanted to secure additional working capital facilities to help it face challenging market conditions but also be operationally strong and benefit from a buoyant steel market.

The GFG Alliance employs 35,000 people in 30 countries, according to its website. In Britain, the opposition Labor Party says the government should consider nationalizing companies if it cannot secure the financial support it is trying to attract.

Italy is not the only country that provides guarantees to the Gupta company. The Scottish government provided 575 million pounds bail to the group in 2016, Reuters reported in 2019, citing people with knowledge of the matter.

British media have reported that the London government has also secured hundreds of millions of loans to the GFG Alliance or related companies under the Coronavirus lending scheme.

$ 1 = 0.8391 euro Reporting by Tom Bergin; Edited by Howard Goller

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The Italian Ministry of Industry gave the green light for the acquisition of OVS Stefanel | Instant News


VENICE (Reuters) – Italy’s Ministry of Industry on Thursday gave the green light for the acquisition of street fashion brand Stefanel by clothing retailer OVS, a union member said.

The retailer is in exclusive talks to buy Stefanel, which is under a special administration, for a total of 3.2 million euros.

OVS will buy the brand and 23 stores from a total of 27 stores, but will not acquire Stefanel’s headquarters, Margherita Grigolato, of the FILCAMS-CGIL union told Reuters.

Reporting by Riccardo Bastianello, written by Giulia Segreti, editing by Francesca Landini

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Fashion retailer Tailored Brands emerged from bankruptcy protection | Instant News


FILE PHOTO: Men’s Tailored Brands Store seen in New York City, USA, July 31, 2020. REUTERS / Brendan McDermid

(Reuters) – Tailored Brands said on Tuesday that it had stepped out of bankruptcy protection following a financial restructuring process that helped the US men’s fashion retailer remove $ 686 million in debt from its balance sheet.

The Houston-based company filed for Chapter 11 bankruptcy in August, joining a list of brick and mortar retailers who have succumbed to the brunt of the COVID-19 pandemic.

This confirmed last month’s restructuring plans consisting of a $ 430 million loan facility.

Tailored Brands said Tuesday that they now operate with a capital structure that includes a long-term loan of $ 365 million, which it hopes will support ongoing operations and strategic initiatives.

The company in July announced plans to cut its workforce by 20% and close as many as 500 stores, in response to the impact of the pandemic.

Reporting by Derek Francis in Bengaluru; Edited by Ramakrishnan M.

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Philip Green’s Arcadia UK fashion group falls into administration | Instant News


LONDON (Reuters) – British tycoon Arcadia fashion group Philip Green has collapsed into administration, putting more than 13,000 jobs at risk and falling victim to the country’s biggest employer from the COVID-19 pandemic so far.

Pedestrians walk past the Topshop shop, owned by the Arcadia group on Oxford Street in London, England, November 30, 2020. REUTERS / Simon Dawson

Deloitte said Monday night that they have been appointed as administrators of Arcadia and will seek buyers for the group’s brands: Topshop, Topman, Dorothy Perkins, Wallis, Miss Selfridge, Evans, Burton and Outfit.

The group trades from 444 sites rented in the UK and 22 abroad.

Deloitte said the Arcadia store will continue to trade, its online platform will continue to operate and supply to concession partners will continue.

It said no redundancy would be announced immediately.

“We will immediately seek expressions of interest and hope to identify one or more buyers to ensure future business success,” said Matt Smith, Deloitte co-administrator.

Green, pictured over a weekend in Monaco where his 100 million pound ($ 133.26 million) super yacht Lionheart was docked, acquired Arcadia for 850 million pounds in 2002.

He did not immediately comment but his CEO blamed Arcadia’s death emphatically on the pandemic.

“In the face of the most difficult trading conditions we have experienced, the obstacles we face are too formidable,” said Ian Grabiner.

British Business Minister, Alok Sharma, said his administration was “very sad news” and the British government would support those affected.

While the COVID-19 lockdown pushed Arcadia to the edge, it has struggled in recent years, underinvesting and failing to keep up with competitors in the growing online retail sector.

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Its brands lie between the likes of Zara, H&M, and Primark Inditex and online-only players ASOS and Boohoo.

The restructuring deal was approved by creditors last year, cutting leases and closing shops, but proved to be only a temporary hiatus.

SALES PROCESS

Mike Ashley’s Fraser Group said Monday that they are interested in participating in any Arcadia sales process.

Topshop, once a top destination for teenagers and fashion lovers, is considered by analysts to be Arcadia’s most attractive asset.

Media reports have also identified Marks & Spencer, Next and Boohoo, as well as private equity players, as potential bidders for individual brands. The three companies declined to comment.

The collapse of Arcadia could have a major impact on the future of the Debenhams department store chain, which is already in administration and employs 12,000 people.

Arcadia is one of Debenhams’ largest concessionaires.

JD Sports Fashion shares, which have been linked with the Debenhams takeover, closed up 5.9%, indicating a loss of interest. Frasers shares closed down 5.7%.

PENSION FUND DEFICIT

Arcadia’s workforce also faces uncertainty over the company’s pension fund deficit, which analysts estimate to be around 350 million pounds.

As part of last year’s restructuring, Arcadia agreed to guarantee 210 million pounds of property assets for the pension scheme, while Tina Green, Philip’s wife and Arcadia’s final owner, agreed to contribute 100 million pounds to the scheme over three years.

“Philip Green must do the right thing and fill the Arcadia pension deficit,” said opposition Labor leader Keir Starmer.

If he doesn’t pay, the 10,000 members of the Arcadia pension scheme will still have to receive most of their entitlements through the government’s lifeboat scheme, the Pension Protection Fund.

Sharma said administrators have three months to file a report on Arcadia director’s behavior with The Insolvency Service that will determine whether a full investigation is needed.

“I will continue to monitor this process,” he said.

Even before the pandemic, brick and mortar clothing retailers in Britain faced major structural challenges with the economy of operating traditional rental stores proving increasingly difficult as more trade migrated online.

This year Oasis, Warehouse, Laura Ashley, Peacocks and Jaeger have fallen into administration.

Reporting by James Davey in London; Edited by Estelle Shirbon, Rosalba O’Brien and Matthew Lewis

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