so marelli, the car parts supplier owned by kkr, is back in restructuring talks… again. their debt is huge (¥650bn) and now there’s drama between kkr, japanese banks, and some big foreign lenders. apparently, the only plan on the table is an up-tiering deal, but japanese banks aren’t into it. anyone think this will actually go through or are we looking at more delays?
up-tiering? never heard of that. what’s that mean?
Dax said:
up-tiering? never heard of that. what’s that mean?
it’s basically when new loans get priority over older debt. common in the us/europe but super rare in japan.
Dax said:
up-tiering? never heard of that. what’s that mean?
it’s basically when new loans get priority over older debt. common in the us/europe but super rare in japan.
ohhh so basically if they do it, the old debt holders kinda get pushed down the ladder?
feels like this is just gonna drag on. japanese banks aren’t budging, and they lend to smaller banks too, so getting agreement is gonna be a nightmare.
Kai said:
feels like this is just gonna drag on. japanese banks aren’t budging, and they lend to smaller banks too, so getting agreement is gonna be a nightmare.
right? plus the foreign lenders wanna make sure marelli doesn’t just sell off assets without fixing the debt situation first. it’s a mess.
didn’t they already restructure in 2022? why are they in trouble again?
Chen said:
didn’t they already restructure in 2022? why are they in trouble again?
yeah, they did a major debt cut (40% haircuts), kkr wrote off $2bn and injected $650mn. but nissan & stellantis have been struggling, so marelli’s sales dropped hard again.
@Sage
so even after all that, they still couldn’t stabilize? rough.
i bet they’ll just end up selling off some assets. japanese banks don’t wanna do up-tiering, so what else can they do?
Finian said:
i bet they’ll just end up selling off some assets. japanese banks don’t wanna do up-tiering, so what else can they do?
makes sense. but some of the lenders wanna hold off on asset sales until the debt issue is sorted. it’s like no one can agree on anything lol.
marelli’s statement made it sound like they’re still operating fine despite all this. anyone buying that?
Zola said:
marelli’s statement made it sound like they’re still operating fine despite all this. anyone buying that?
idk, they said earnings before interest & tax (excluding restructuring stuff) was better than 2023, even tho revenue dropped. but still, they need cash bad.
@Sage
sounds like they’re just trying to keep confidence up. if they need ¥100bn fast, they’re in trouble.