(Bloomberg) -- Intrum AB is in talks with holdout creditors to persuade them to sign up to its restructuring proposal, according to people familiar with the matter.
The Swedish debt collector and its advisers are looking to find a compromise on its debt plan with holders of the majority of its 2025 bonds, said the people, who asked not to be identified because the matter is private.
Intrum has been trying to win over investors to stabilize an unsustainable debt structure that is facing looming maturities. It already has the support of more than 72% of bondholders who signed up to a binding agreement, exceeding the two-thirds threshold required for a Chapter 11 process in the US or a Swedish reorganization proceeding.
The company could also opt for a less costly UK court restructuring if it succeeds in winning over 75% of bondholders to support the deal. Still, an agreement with the 2025 bondholders would bring it closer to a potential consensual implementation. The company needs at least 90% creditor support to avoid a court process.
Intrum and the 2025 bondholders still have a lot of ground to cover, while creditors who already support Intrum’s plans would have to approve any significant changes to their agreement, said the people. There is no certainty that the talks would yield a deal, and the company could still look to implement its proposal without the consent of the opposing group, the people said.
A representative for Intrum declined to comment when contacted for a response.
A deal struck earlier with a separate group of creditors entailed the full repayment of the 2024 bonds and a 90% extension in the nominal value of all later notes.
Those creditors include Davidson Kempner Capital Management LP, BlackRock Inc., H.I.G. Capital, Mandatum Asset Management Oy, Capital Four, Intermediate Capital Group Plc and Spiltan Fonder AB. They committed to provide €526 million ($575 million) in new funding, partly for bond buybacks.
The 2025 bondholders are opposing the deal as they demand better terms, especially as their debt is getting treated the same way as other notes due in later years, Bloomberg News has reported.
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