|
|
|
|
|
|
|
|
|
|
Medallia Cedes Control to Blackstone-Led Creditors; Vanderbilt Exclusivity Extended
|
|
|
|
|
|
|
|
Good day and welcome to WSJ Pro Bankruptcy's Daily Briefing. It's Thursday, June 18. In today's briefing, Medallia has agreed to hand over control to a group of lenders led by Blackstone, Apollo and KKR in a restructuring that will slash the software company's debt burden and likely wipe out private-equity owner Thoma Bravo. And a bankruptcy judge granted Vanderbilt Minerals a shortened extension of its exclusive right to file a chapter 11 plan through Aug. 26.
This newsletter won't be published Friday in observance of Juneteenth in the U.S. We'll be back Monday.
|
|
|
|
|
|
|
|
Orlando Bravo, co-founder of Thoma Bravo, at the Semafor World Economy Summit earlier this month. Aaron Schwartz/Bloomberg News
|
|
|
|
|
Thoma Bravo’s Medallia Strikes Deal to Hand Control to Lenders
|
|
|
Medallia, the software company owned by private-equity firm Thoma Bravo, said Wednesday that it has agreed to be taken over by a group of lenders led by Blackstone, Apollo Global Management and KKR.
The transaction will significantly reduce Medallia's debt burden and includes a $150 million capital infusion from the lender group, which will assume ownership of the company.
The restructuring highlights growing strains in parts of the private-credit market and among software-as-a-service companies facing disruption from the advent of artificial intelligence. Thoma Bravo paid roughly $6.4 billion, including debt, to take Medallia private in 2021, with private-credit lenders providing much of the financing.
Thoma Bravo is expected to be wiped out as the lenders take full ownership of the company. Medallia didn't disclose the extent of the debt reduction, though the Wall Street Journal reported in April that lenders were discussing cutting the company's roughly $3 billion of loans to between $1 billion and $1.4 billion.
Blackstone and KKR earlier this year marked down the value of their Medallia holdings. The company said the new financing will support its commitment to reposition itself for an AI-driven market.
—Alexander Gladstone
|
|
|
|
|
|
Vanderbilt Minerals Wins Exclusivity Extension to Late August
|
|
|
A bankruptcy judge on Wednesday granted Vanderbilt Minerals an extension of its exclusive right to file a chapter 11 plan.
The former talc-mining unit of R.T. Vanderbilt had sought a 120-day extension through October but agreed to the shorter timeline after facing opposition from a committee representing talc-injury claimants, which is seeking to dismiss the bankruptcy case.
The committee argued in court filings that the case was filed as a litigation tactic to shield its non-bankrupt parent and affiliates from talc-related lawsuits at the expense of victims.
If the chapter 11 proceedings are allowed to continue, it should be permitted to propose a competing exit plan rather than remain bound by Vanderbilt's exclusivity rights, the committee said.
Vanderbilt’s exclusivity period has now been extended to Aug. 26. The parties are scheduled to return to court Aug. 19 for a hearing on the committee's motion to dismiss the case.
—Akiko Matsuda
|
|
|
|
|
|
|
|
CarMax said its profit was hurt by price cuts the company had implemented to help spur sales. Justin Sullivan/Getty Images
|
|
|
|
|
CarMax’s Turnaround Is Taking Shape, Still Has Long Way to Go
|
|
|
CarMax’s turnaround is starting to take shape, but the used-car retailer still has a lot of work to do to reach its full potential.
Chief Executive Keith Barr, who stepped into the top role in March, said on a call with analysts Wednesday that the company’s core operations aren’t fast and efficient enough, and that its costs remain too high.
At the same time, he said CarMax’s digital experience is too complex and unconnected to the company’s in-person experience, which itself has problems. The good news, though, is that all of these pain points are addressable.
|
|
|
|
Car ‘Playgrounds,’ Smartphone Shopping: Inside Carvana’s New-Car Sales Playbook
|
|
|
Carvana became famous for its giant “vending machines” that house the used cars it sells online. Now, as the chain branches into new-car sales, it is trying a different approach: “new-car playgrounds.”
The Tempe, Ariz.-based company this week revealed its concept for a new-car dealership designed for smartphone-based shopping rather than paperwork and interactions with salespeople.
At the playground, customers can sit inside vehicles and use their phones to get details or order a test-drive, with or without the involvement of a store employee.
|
|
|
|
|
“We’re not trying to sell cars here. We’re trying to present cars.”
|
|
— Tom Taira, Carvana’s president of special projects
|
|
|
|
|
|
|
|
|
|
Fed Holds Rates Steady, but More See Higher Rates as Next Move
|
|
|
Federal Reserve officials signaled Wednesday that their next move might be to raise interest rates, not cut them, a striking reversal at Kevin Warsh’s first meeting as chairman and a sign of how sharply the inflation outlook has turned.
The Fed held its benchmark rate steady, in a range of 3.5% to 3.75%, in a unanimous vote. But officials’ quarterly economic projections told the story of the shift: Nine of 19 officials penciled in at least one rate increase by year’s end, up from none in March. Just one foresaw a cut, down from 12.
|
|
|
|
|
|
|
|
|
|
|
|
