Greensill Capital lines up Grant Thornton for restructuring

Fintech firm Greensill Capital may be heading for bankruptcy after Credit Suisse froze $10 billion of its assets. While venture investor Apollo Global Management is understood to potentially be interested in acquiring some of Greensill's assets, the company has also lined up Grant Thornton to oversee administration proceedings.

Founded in 2011 by Australian entrepreneur Lex Greensill, Greensill Capital is a financial services company based in the UK, focused on the provision of supply chain financing and related services. Last year the company had hoped to float on the stock market with a $7 billion valuation, while after leaving office, former Prime Minister David Cameron was even signed up as a senior adviser to Greensill, jetting about the world promoting the business.

Cameron said as recently as December 2019, “From its UK foundations, Greensill has taken on the world, upending traditional financing models and democratising capital to give businesses, including many SMEs and small traders, access to low-cost funding.”

However, in a spectacular fall from grace, the FinTech firm could now be heading for bankruptcy, after Credit Suisse froze $10 billion of investment funds that fueled the SoftBank Group-backed finance startup. As reported by The Wall Street Journal, the Swiss bank was apparently concerned about the extent of the connection between the company and metal tycoon Sanjeev Gupta. Credit Suisse later said it had taken the step in early March "to protect the interests of all investors," with the financial institution adding that some of the fund's assets "are currently subject to significant uncertainties regarding their accurate valuation."

A statement from Greensill said the company acknowledged the decision to suspend the funds “temporarily,” before announcing that the company was in talks with potential outside investors. Greensill is reportedly in talks with venture investor Apollo Global Management about a possible deal to acquire some of its assets, which could see Greensill handed a $100 million lifeline.

However, such a sale seems a remote prospect at present – as Greensill has already filed for protection from Australia’s insolvency regime amid its rush to find a bailout deal. The company hopes to invoke “safe harbor” protection in Australia, which protects directors from personal liability for a company operating in insolvency, according to people familiar with the matter.

Meanwhile, in the UK, the firm is said to have hired Grant Thornton to guide it through a potential restructuring, and could file for insolvency within days, according to people familiar with the company. Both Greensill and Grant Thornton declined to comment on the matter.