Sunday, November 3, 2013
Insolvent "Gherkin" Owner IVG To Restructure With Court Consent
A German court started insolvency proceedings for the co-owner of London's landmark Gherkin tower, German property group IVG Immobilien, which will continue to reorganise under its own administration, Reuters reported. IVG plans to submit a plan for its reorganisation to the court prior to Christmas and schedule a vote for its creditor committee in January, the company said on Friday. Should both agree to the plan, which would likely involve a debt-for-equity swap, it could exit the insolvency proceedings in the first half of next year as planned. One of Germany's best known real estate firms, IVG amassed over 4 billion euros ($5.5 billion) in debt during a rapid expansion when it financed a business-and-hotel complex located at the Frankfurt airport called "The Squaire". It was also hit by growing unwillingness among European banks to provide new credit as new regulations force them to reduce their exposure to property. After a debt-for-equity swap that would have wiped out existing shareholders failed to win support from enough creditors, the company decided it could no longer remain a going concern and sought protection from creditors in August. Later that month a court in Bonn approved its application to reorganise itself under the new restructuring process, appointing insolvency expert Horst Piepenburg only as a preliminary trustee without any authority to make decisions rather than as a formal administrator.
Mon., November 4, 2013