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Banking industry

Restructuring and Refinancing in the Midst of Economic Downturn

Strategic Insights

— 2 min read

As the global economy continues to struggle, companies in various industries are facing significant challenges. Many are seeking to restructure their debt and adapt to the changing market conditions. In this context, several companies have undergone significant changes in their debt financing and restructuring strategies. BNP Paribas, a French bank, has eliminated its distressed finance group and reduced its staff by 5% as part of a restructuring effort. The bank's global head of high yield, John Ong, left the firm in January, while Youssef Khlat, the European head of high yield capital markets, also departed.

Morgan Stanley has created a European restructuring business, with Simon Parry-Wingfield and Ben Babcock serving as co-heads. The bank has also scaled back its leveraged finance team, focusing on distressed companies instead. Royal Bank of Scotland has announced its exit from leveraged lending, while Barclays is marketing a $225 million facility for Tribune Receivables.

Statistics:

  • BNP Paribas eliminated its distressed finance group.
  • The bank reduced its staff by 5% as part of its restructuring effort.
  • John Ong, the global head of high yield, left the firm in late January.
  • Youssef Khlat, the European head of high yield capital markets, departed from the bank.
  • Morgan Stanley created a European restructuring business, with Simon Parry-Wingfield and Ben Babcock as co-heads.
  • The bank scaled back its leveraged finance team, focusing on distressed companies instead.
  • Royal Bank of Scotland announced its exit from leveraged lending.
  • Barclays is marketing a $225 million facility for Tribune Receivables.
  • Tribune Company has approximately $7.6 billion in assets and $12.9 billion in debt.

Key Takeaways:

  • Several companies have undergone significant changes in their debt financing strategies, adapting to the challenging economic environment.
  • Restructuring and refinance efforts are underway, with companies seeking to reduce their debt burden and access liquidity.
  • Morgan Stanley has created a European restructuring business, expanding its focus on distressed companies.
  • Royal Bank of Scotland has exited the leveraged lending market, while Barclays has marketed a facility for Tribune Receivables.
  • Tribune Company has significant debt and asset base, with a net loss of $393 million in the fourth quarter of 2008.
  • Companies in the automotive and manufacturing sectors are also affected, with Oshkosh Corp. reaching an agreement with lenders to amend its credit agreement and Hanesbrands amending its senior secured credit facility.

Sources:

  • Spokeswoman for BNP Paribas
  • John Ong, global head of high yield at BNP Paribas
  • Youssef Khlat, European head of high yield capital markets at BNP Paribas
  • Morgan Stanley spokesman
  • Standard & Poor's Leveraged Commentary & Data
  • Tribune Company court filings
  • Bank of Montreal
  • Jefferies
  • J. Aron & Company
  • Dow Chemical Co.
  • Fleetwood Enterprises
  • Securities and Exchange Commission
  • Hanesbrands
  • Ferro Corp.
  • Wendy's/Arby's Group
  • Miller Buckfire
  • Magna Entertainment
  • MI Developments
  • CBS MarketWatch

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