SoftBank-backed Katerra is going bankrupt

Katerra, a US construction company backed by SoftBank’s Vision Fund, went bankrupt with more than $ 1 billion in liabilities, becoming the second largest portfolio company in the Japanese conglomerate to collapse this year.

In a statement, Katera said they had applied for protection from creditors “after the rapid deterioration of the company’s financial position.” It blamed Covid-19 for the “unexpected insolvency” of its former creditor Greensill Capital and its inability to secure new financing. The company said it would launch a marketing-sales process “to maximize value for its stakeholders.”

Bankruptcy marks the latest setback for SoftBank’s Vision Fund, which has recently had great success with portfolio companies such as Coupang and DoorDash. The Vision Fund reportedly invested more than $ 2 billion in Catera, including a cash infusion in December as part of a recapitalization.

Katerra was a customer of Greensill, a network financing company backed by SoftBank, which collapsed earlier this year. Catherine did not name Greensil in the statement.

Founded in Silicon Valley, Catera raised billions of dollars in an effort to reduce construction costs by building building components in factories rather than on site.

But the company has struggled to contain costs and has faced delays in several major projects. Me:internal drama has caused Departure: Co-founder Michael Marx took over as CEO in May last year.

Katerra said it had received a $ 35 million creditor from SoftBank, which owns the lender, which allows the company to continue operating while the bankruptcy process continues, and the bankruptcy will not affect its international operations. The company estimates its assets at $ 500 to $ 1 billion and its liabilities at $ 1 billion to $ 10 billion. SoftBank declined to comment.

The lawsuits in the state of Texas showed that Catera earned about $ 1.75 billion last year. The company has almost 2400 employees, reports LinkedIn.

The collapse of Katerra sparked tensions with SoftBank’s Credit Suisse, which was selling assets that were jointly repaying Greensill loans.

Credit Suisse is trying to recover some of the $ 440 million in debt owed to Katera held by the funds. Financial Times: reports Last week, the Swiss bank was preparing for a possible lawsuit against one of its key customers, SoftBank, following the collapse of Greensill.

In November last year, SoftBank immediately injected cash into Greensill to cover its debts to Katerra. However, the cash never reached Credit Suisse’s funds as intended by FT reports,

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