(Bloomberg) -- Sweden’s Intrum AB has struck an agreement with a noteholder group that could resolve a key obstacle in the debt collector’s bid to restructure in US bankruptcy court.
The company had “come to terms” with the group of debt holders ahead of a hearing in the US bankruptcy court, according to Andrew M. Leblanc, a company attorney. The agreement requires the consents of other parties, a process that’s currently underway, he said at a Monday hearing in Texas.
The deal needs nods from a majority ad-hoc group, which backed the restructuring and sided with Intrum in fighting against the opposing group, Leblanc said. Terms of the latest deal and positions of the majority group were not disclosed to the court as of late Monday.
In a separate statement, Intrum said it was “engaged in settlement discussions” with the minority group of holders of its notes due 2025, which is objecting to the company’s pre-packaged Chapter 11 filing. The company confirmed any such deal would need the support of locked-up creditors, including lenders and noteholders.
The majority ad-hoc group consists of BlackRock Inc., Davidson Kempner Capital Management, H.I.G. Capital, among others, as of November, according to court papers.
Intrum, one of Europe’s largest credit management companies, filed for Chapter 11 bankruptcy in Texas in November. The company started talks to restructure its nearly $4.7 billion funded debt earlier this year, after its operations were hit by soaring bad loans with interest-rates high.
A group of holders of Intrum’s 2025 notes opposed the deal, arguing that the plan doesn’t reflect that their bonds are first temporally in line of repayment. That group’s members include Diameter Capital Partners, court papers show. The group further took to object the Chapter 11 bankruptcy plan in the US.
The court hearing is scheduled to resume on Tuesday, according to Judge Christopher M. Lopez.
The case is Intrum AB, 24-90575, US Bankruptcy Court, Southern District of Texas.
--With assistance from Giulia Morpurgo.
(Updates with comment from Intrum statement.)
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