Carvana and creditors representing over 90% of its outstanding senior notes have agreed to a restructuring that will reduce the U.S. used-car retailer's total debt by over $1.2 billion, sending its shares surging 40% in premarket trading.
and creditors representing over 90% of its outstanding senior notes have agreed to a restructuring that will reduce the U.S. used-car retailer's total debt by over $1.2 billion, sending its shares surging 40% in premarket trading.
The company on Wednesday also reported a smaller second-quarter loss and forecast another core profit in the third quarter. The agreement will eliminate more than 83% of Carvana's unsecured notes maturing in 2025 and 2027 and lower required cash interest expense by over $430 million per year for the next two years.
"Apollo is pleased to support this debt exchange agreement, which stands to significantly strengthen Carvana's financial position while providing creditors with new first lien debt," John Zito, Apollo's Deputy CIO of credit, said in a statement.some of Carvana's largest creditors including Apollo Global Management and Pacific Investment Management have signed a cooperation agreement to act together in any restructuring negotiations.
The company's second-quarter net loss narrowed to $58 million, or 55 cents per class A share, from $238 million, or $2.35 per class A share, a year earlier.Reporting by Nathan Gomes in Bengaluru; Editing by Shweta Agarwal and Sriraj Kalluvila
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