While the liability management playbook is observed from Europe with interest, few companies have actually executed the more aggressive non-pro rata deals often seen in the US that involve drop-downs, uptiers, double dips and the like in any meaningful size.

Indeed European CLOs were shocked when they were cut out of one such deal for the international materials company and cross-border loan issuer Loparex, as 9fin reported.

Then when global packaging conglomerate Ardagh — founded in Ireland with headquarters in Luxembourg, and the issuer of $12bn-equivalent of dollar, euro and Sterling-denominated debt — retained restructuring advisors from Kirkland & Ellis and Houlihan Lokey, 9fin learned they were both being led by teams in the US rather than Europe.

Two creditor groups formed and it quickly became clear that this would likely be a US-style playbook, with priming or value-stripping transactions being pitched to Ardagh by secured lenders and third parties, while junior creditors would have to scramble to counter any move that would leave 2027 maturities unaddressed.

Meanwhile, likely the largest active distressed situation out there in terms of outstanding debt is Altice France, with €24.7bn ($26.8bn) equivalent in funded debt issued in euros and dollars (yes more than DISH). Altice could soon supplant DISH’s recent bondholder organization for the largest co-op group ever. As 9fin reported this week, the secured lenders are banding together after executives said creditors would have to help the company reduce its leverage.

That statement by executives came after Altice France designated Altice Media as an unrestricted subsidiary, and agreed to sell that unit and some of its data centers for €2.1bn, a designation that gives Altice France flexibility as to what to do with proceeds (read more on the implications here).

The secured group held pitches for a financial advisor over the past week while a crossholder group holding SSNs and SUNs has been organized with advisors in place, all working out the game theory to make sure they’re not left structurally or contractually subordinated to the assets from which they had once expected credit support.

Altice France itself, as 9fin has tallied, has significantly more than $10bn capacity to designate current restricted subsidiaries as unrestricted in the future, where the company can choose not to use asset sale proceeds for debt repurchases at all, and if it does buy back debt, it can structure the transaction however it likes.

North America appears to be ever-increasingly exporting out-of-court restructuring mechanisms to match some of the borrowed bankruptcy practices across the new restructuring regimes of the UK and EU.

People Moves

If you have any recent moves to announce, please send to one of our team’s emails below to include in our People Moves section.

Alfredo Pérez, a recently retired Weil Gotshal partner, has been reportedly picked to join the Southern District of Texas bankruptcy court, where he will step in for Judge David R. Jones, who resigned amid a conflicts scandal last fall. Scott Colton has joined Akin Gump’s special situations and private credit practice as a partner in New York. Colton came from Paul Hastings, following the footsteps of private credit partner Bill Brady. For its part, Paul Hastings added structured finance lawyer Shawn Kodes as co-chair of its asset-backed finance practice from Weil.

The Default Notice is produced by 9fin’s distressed and restructuring team: Max Frumes | max.frumes@9fin.com, Rachel Butt | rachel@9fin.com, Max Reyes | max.reyes@9fin.com, Kartikeya Dar | kartik@9fin.com, and Larry Feldman | larry@9fin.com

This week’s news

Altice France — A group of Altice France’s secured creditors are in talks to form a cooperation agreement, which would bind them to act together in potential talks with the struggling telecoms company, 9fin reported this week.

Hearthside Food Solutions — The Charlesbank-backed food manufacturer is looking to raise funding ahead of its debt maturities, led by a revolver due in November this year.

Astound Broadband — A group of lenders has started confidential talks with the Stonepeak-backed internet and cable provider. While the company has far-dated debt maturities, it is grappling with a cash flow squeeze.

Fisker — The company said it hired Deutsche Bank and PJT Partners to serve as financial advisors as it continues to evaluate strategic alternatives. The company also disclosed that it had entered into a forbearance agreement with Heights Capital Management.

MRP Solutions — Lenders to Clearlake Capital-backed packaging manufacturer MRP Solutions (fka Mold-Rite Packaging) are organizing and are in talks with Perella Weinberg Partners, according to 9fin sources.

Incora — Independent director Patrick Bartels returned to the witness stand for cross-examination from counsel to Langur Maize and the ad hoc group of 2024-2026 noteholders.

Steward Health Care — A 9fin analysis outlines that Medical Property Trust’s total economic exposure to Steward could be as much as $4.8bn across its real estate investments, loans, unpaid rent, and minority equity investment as the struggling health operator approaches a 30 April forbearance agreement expiration with its ABL lenders.

Xplore — The Canadian rural internet provider kickstarted a grace period after skipping a coupon payment due at the end of March. It has been in talks with creditors and sponsor Stonepeak on ways to restructure its legacy business and fund the growth of its fiber projects.

Spirit Airlines — Read the first of our three-part series that will cover Spirit’s financial performance, its capital structure and debt covenants, options Spirit has to address 2025 maturities, and the novel 'triple-dip' claim that Spirit’s $1.1bn senior secured bonds due 2025 may have.

Russell Investments — The investment services firm owned by private equity firms TA Associates and Reverence Capital Partners completed its amend-and-extend deal to address its upcoming 2025 term loan maturity.

Cumulus Media — Cumulus Media for the fourth time extended the deadline for its proposed exchange, disclosing that they’re stuck on $15m of bonds agreeing to exchange, no change from the third extension. 9fin previously reported creditors holding a majority of the company’s term loans and secured bonds entered into a co-op agreement in response to what lenders are calling an “aggressive” exchange offer.

ConvergeOne — The technology services provider filed a prepack in SDTX with an RSA signed by 81% of its first lien and second lien lenders that would see the equitization or cancellation of $1.6bn in funded debt, with first lien lenders set to receive most of the reorg equity.

MyEyeDr — The Goldman Sachs-backed vision care chain is regaining the confidence of investors with its latest refinancing thanks to a new slug of preferred equity and improved finances.

SIRVA — The outsourced moving services provider has raised senior debt after engaging advisors to explore options as it deals with a heavy debt burden and weak performance.

Other active distressed and restructuring coverage

Graftech — 9fin has reported the company is evaluating new money proposals from third parties as it gears up for negotiations with debt investors.

Bausch Health — The healthcare giant is gearing up for a liability management transaction in the coming months in a bid to bring down leverage.

Michaels Stores — The bonds of Apollo-backed retailer traded up after the company reported an encouraging jump in fourth quarter EBITDA.

Telesat Canada — 9fin provided a comprehensive analysis of the company’s recently disappointing earnings causing the company’s bonds and equity to fall sharply in response.

Asurion — The electronics insurance and repair company’s term loans traded lower after the firm asked lenders for permission to delay its earnings report so that it can investigate a non-compliance allegation, according to 9fin sources.

CURO Group — In a pre-pack led by Oaktree, Caspian Capital and Empyrean, the consumer finance company filed for Chapter 11 in SDTX with a plan that calls for the equitization of most of its secured debt and an effective date within 120 days post-petition. The filing came with a $70m DIP that Judge Marvin Isgur noted was “very expensive.”

Hawaiian Electric — A federal court remanded various cases related to the state utility’s potential wildfire liabilities back to a state court in a blow for the defendants, with Judge Jill Otake basing her decision on an analysis of the Multiparty, Multiform Trial Jurisdiction Act of 2002 (MMTJA).

Ardagh — A crossholder group of the Irish packaging producer’s unsecured notes and ARD Finance PIK notes has started to amass a considerable number of creditors, 9fin reported.

Joann — The retailer commenced a prepackaged Chapter 11 case with a transaction support agreement entered into with its lenders and majority equity holders. It aims to exit bankruptcy by early May. Here is a summary of the key restructuring terms.

Robertshaw — The electronic components and systems maker received final DIP financing and bidding procedures approval from Judge Lopez, while entering into a settlement with a group of lenders aggrieved of its May 2023 uptiering.

WW International — 9fin has reported on how weight loss drugs are hurting brands like Weight Watchers and Herbalife.

TGI Friday’s — The restaurant chain has engaged Guggenheim to raise roughly $200m of new funding to pay down debt.

Red Lobster — The seafood restaurant chain is seeking third party financing as it faces steep losses and debt coming due in 2026. It has also brought on a new independent board member at the behest of its lenders.

Rubio’s Restaurants — Rubio’s is considering a possible Chapter 11 bankruptcy filing in order to sell itself. A bankruptcy filing would be its second in the past four years.

McAfee — A group of lenders that 9fin had reported had organized are said to have signed a cooperation agreement and also hired Centerview.

Belk — Lenders to the department store chain have been speaking with the company about a restructuring that could exchange much of its debt into equity.

Cano Health —The de-SPACed healthcare services provider is in bankruptcy with a restructuring support agreement from holders of around 86% of its secured debt and 92% of the senior notes.

Charge Enterprises — The electric vehicle charging company remains in Chapter 11 before the US Bankruptcy Court for the District of Delaware.

CommScope — Unsecured lenders to the struggling telecommunications infrastructure company pitched new money second lien financing to repay near-term maturities.

DISH/EchoStar — 9fin reported the telecom company is sounding out interest from third-party investors on financing proposals, after nixing two proposed exchange offers.

Enviva — The troubled wood pellet producer is in bankruptcy before the US Bankruptcy Court for the Eastern District of Virginia.

Gol — Gol’s Abra bondholder group recently disclosed updated members and holders including distressed investors. The bankrupt airline has said it will evaluate all recapitalization or other transactions, including to raise capital while in bankruptcy.

Office Properties Income Trust — The office REIT continues to evaluate raising debt against its over $3bn of unencumbered assets, as it chips away at its maturity wall.

SI Group — The chemical additives company recently shared preliminary 2023 results, which left some investors questioning the sustainability of its capital structure, even as its business shows signs of recovering.

Sonrava Health (fka Western Dental) — The New Mountain-backed company is sounding out investor interest on new funding backed by its accounts receivables balance.

Staples — The Sycamore Partners-backed company’s bonds popped on encouraging Q423 guidance, boosting investor confidence on its refinancing prospects.

Thrasio — The Amazon aggregator filed for bankruptcy following stalled demand growth and liquidity pressure post the pandemic-fueled e-commerce boom.

United Site Services — Certain lenders to the portable toilet rental company have banded together as the company battles weaker earnings amid an inflationary and higher rate environment.

Veritas Technology — Creditors will look forward to LME proposals to address 2025 maturities alongside a complicated M&A transaction.

Workhorse — The electric vehicle company is working with Stifel to help raise bridge financing as it combats cash flow pressures.

VeriFone — Lenders to the payment and commerce solutions company have organized with Gibson Dunn as they prepare for negotiations ahead of the maturity of the company’s $250m revolver and over $2bn of term loans in 2025.

Emergent BioSolutions — The life sciences company disclosed a forbearance agreement with its secured lenders through 30 April 2024 as newly appointed CEO Joseph Papa takes the reigns amid an effort to stabilize the business and address the capital structure.

Weekly declines:

Top bond movers (link to full screener on 9fin)

Top loan movers (link to full screener on 9fin)