Tuesday, August 20, 2013
IVG to Ask Court to Oversee $4.3 Billion Debt Restructuring
Wed., August 21, 2013
IVG Immobilien AG (IVG), the German property company that’s lost most of its market value, said it will file for court protection to reorganize 3.2 billion euros ($4.3 billion) of debt after talks with creditors failed, Bloomberg reported. IVG will apply today with the Bonn District Court to initiate a proceeding similar to U.S. bankruptcy reorganization, the company, based in the same city, said in a statement. The procedure protects companies from claims while they try to reach a court-approved agreement. “Despite weeks of intensive mediations and negotiation efforts on the the part of IVG, the individual creditor groups were unfortunately unable to agree on a consensual solution taking into account all stakeholder interests,” Chief Executive Officer Wolfgang Schaefers said in the statement. IVG, once Germany’s biggest publicly held property company, saw its value plummet since 2007 after demand for its office buildings fell in the wake of the financial crisis. IVG owns about 5 billion euros of office buildings in Europe and manages 15 billion euros of real estate for private and institutional clients, including a fund that owns a 50 percent stake in London’s Gherkin tower.