FINANCE GIANT GREENSIL ANNOUNCES BANKRUPTCY
Troubled United Kingdom finance firm Greensill has collapsed into administration after encountering serious financial difficulties, administrators Grant Thornton said Monday (Tuesday in Manila), sparking fears for the future of thousands of jobs worldwide.
Greensill specialises in short-term supply chain financing for businesses, but itself faces funding problems and mounting questions over opaque and complex accounting methods.
Administration caps a crisis-hit month for Greensill, whose collapse risks more than 50,000 jobs — including over 7,000 in Australia — across the group and its customers.
“Chris Laverty, Trevor O’Sullivan and Will Stagg of Grant Thornton UK LLP were appointed as joint administrators of Greensill Capital (UK) Limited and Greensill Capital Management Company Limited,” Grant Thornton said in a statement on Monday.
“The joint administrators are in continued discussion with an interested party in relation to the purchase of certain Greensill Capital assets.
“As these discussions remain ongoing, it would be inappropriate to comment further at this time.”
Sources close to the matter confirmed a Financial Times report that US private equity firm Apollo was seeking to buy parts of the group.
The paper cautioned however that any Apollo rescue would not include loans made to the GFG Alliance Group headed by Indian-British steel billionaire Sanjeev Gupta.
Greensill lawyers appeared before a UK court on Monday, stating in court documents that it has “fallen into severe financial distress” and can no longer pay debts, the FT said.
Both Greensill and Apollo have declined to comment on the matter. Greensill was thrown into crisis one week ago when lender Credit
Suisse suspended $10 billion in funds after discovering that $4.6 billion of insurance underpinning Greensill contracts had expired.
Greensill lawyers said Monday that Credit Suisse had demanded repayment of a $140-million loan — but had admitted that the firm has “no conceivable way” of repaying the sum.