Genesis Global Holdco and the Creditors: Resolving Claims
Genesis Global Holdco’s parent company, Digital Currency Group (DCG), has reached an in-principle deal with the creditors to resolve the claims of the bankrupt crypto lender. The deal, if approved, could result in recoveries of 70% to 90% for unsecured creditors in USD equivalent and recovery rates of 65% to 90% in kind, depending on the denomination of the digital asset.
Key Points:
– Genesis’ liabilities include $630 million in unsecured loans due in May 2023 and $1.1 billion under an unsecured promissory note due in 2032.
– DCG may engage in new debt arrangements and partial repayment to meet its obligations to creditors.
– The debts include a $328.8 million first-lien facility set to mature in two years and an $830 million second-lien facility with a maturity period of seven years.
– Genesis plans to pay $275 million in four installments.
– Genesis filed for Chapter 11 bankruptcy protection in January, owing over $3.5 billion to its top 50 creditors.
This development follows Genesis’ recent agreement with FTX on a $175 million claim.
Hot Take
The in-principle deal between Genesis Global Holdco and its creditors is a positive step towards resolving the claims of the bankrupt crypto lender. If approved, this deal could provide significant recoveries for unsecured creditors and help Genesis meet its obligations. The ongoing efforts to address the debts and reach agreements with creditors demonstrate the commitment of Genesis and its parent company, Digital Currency Group, to navigate through the challenges and move towards a more stable financial position.
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