Intrum files for bankruptcy in US to restructure $4.5 billion debt pile

Intrum AB

15/11/2024 21:22

Nov 15 (Reuters) - Intrum  INTRUM.ST , Europe's biggest
debt collector, on Friday said it had filed for Chapter 11
bankruptcy in the United States in a bid to restructure its
debt.
    The company has struggled as the pandemic, an energy crisis
and two-decade-high interest rates failed to unleash a wave of
loan defaults, with concerns mounting over Intrum's net debt,
which reached 49.4 billion Swedish crowns ($4.49 billion) at the
end of September.
    Intrum, which last month announced plans to file for the
Chapter 11 protection, listed assets and liabilities in the
range of $1 billion to $10 billion and estimated its number of
creditors in the range of 1,000 to 5,000, according to a court
filing.
    "Today, with support from the overwhelming majority of our
key stakeholders, we are making significant progress towards the
implementation of our recapitalisation transaction," said Intrum
CEO Andres Rubio.
    Intrum had won support for a debt restructuring from 73% of
its noteholders, enough for a U.S. Chapter 11 procedure but
short of the 75% needed to qualify for a simpler process under
English law or a 90% threshold for an all-voluntary process.
    The company said it plans to continue to operate as normal
with no disruption to its services and that it has sufficient
liquidity to continue operations and execute its business plan
throughout the Chapter 11 case. 
    The company said it would remain in possession and control
of its assets, retain its existing management team and board of
directors during the bankruptcy proceedings.
    The move by Intrum comes at a time when the debt collection
industry in Europe faces challenges, with a significant decline
in non-performing loans diminishing the volume of business
available for these companies.
    Intrum, which expects to complete its Chapter 11 proceedings
before year-end, also plans to execute a Swedish company
reorganisation during the first quarter of 2025, it said on
Friday. 

($1 = 10.9958 Swedish crowns)

 (Reporting by Bipasha Dey in Bengaluru; Editing by Maju Samuel)
 ((Bipasha.Dey@thomsonreuters.com;))