We have to wonder about the logic of investors who loans millions of dollars to a money-losing business and then ask for a piece of the floundering company when the loans cannot be repaid, but that is exactly what some of Intrawest ULC’s creditors are asking for according to a story on Bloomberg.com.
Fortress presented lenders including Davidson Kempner Capital Management LLC and Oak Hill Advisors LP with a plan last month to swap the loan for new debt maturing in 2015, according to the people, who asked not to be identified because the talks are private. Lenders rejected the proposal, which gave them the option to convert some of the debt to equity in five years. Some lenders want equity now so they can benefit if Intrawest’s business rebounds.
Guess if you were silly enough to sink millions is ski resort real estate in the first place you might miss the fact that Intrawest probably doesn’t have much rebound in its future.
[Link: Bloomberg.com]
