EUR 180m loan to a privately held Oslo based commercial and residential portfolio
Starting point 2009:
After a multi-year acquisition spree, the borrower implodes and hovers near bankruptcy
Stops servicing its debt to Reviva’s client who is the sole financial creditor of the borrower
The situation we were faced with:
Complex group structure, with 65 legal entities holding residential, commercial, hotel, land and a real estate broker business
Uncooperative and hostile owner with on-going negative press coverage and multiple court cases pending
Under invested residential assets with high vacancy and in some cases in breach of existing zoning plan permits
Significant and constant bankruptcy threat from trade creditors
Booking, accounting and other administrative functions in a state of complete disarray
A sales effort in late 2008 indicated a recovery of EUR 80-100m
Where Reviva added value:
Negotiated a voluntary hand-over from owners and immediately appointed local interim management
Incorporated a new hold-co and a new op-co and initiated a simplification process of the corporate structure
Cleaned up the balance sheet, untangling a web of inter-company credits, shareholder loans and tax obligations
Stabilized and incentivised local management to lead the daily operations through the restructuring period
Settled multiple disputes with counter-parties, both in and out of court
Provided board-level directors and enforced firm corporate governance
Took on assets from other collapsed Oslo-based borrower under the same structure
Initiated a multi-year self-funded (through rental income) CAPEX program to minimise vacancy and optimise asset value
Streamlined portfolio by selling off non-core assets
Outcome:
A clean company structure of 20 entities, including a 10 person management company, with a solid 3-year operational history, was sold in Dec 2014
Recovery of EUR 160m, in addition to interest servicing throughout the holding period