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Spirit Airlines Strikes Restructuring Deal; Raistone Files for Liquidation
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Welcome to WSJ Pro Bankruptcy's Daily Briefing. It's Wednesday, February 25. In today's briefing, Spirit Airlines has reached a deal with creditors to exit bankruptcy by early summer as a smaller airline with a reduced fleet and over $5 billion less in debt and lease obligations. And Raistone Capital, a trade finance firm caught up in the collapse of auto-parts supplier First Brands Group, filed for chapter 7 liquidation in New York.
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Spirit has been unloading planes to save money and cut debt. Ryan Murphy/Reuters
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Spirit Airlines Plans Life After Bankruptcy With Creditor Deal
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Spirit Airlines has reached an agreement with a group of creditors to emerge from bankruptcy by early summer as a smaller company.
Lawyers for the discount airline told a bankruptcy judge Tuesday that its deal would allow it to exit from the chapter 11 proceedings with a stronger balance sheet and reduced fleet size.
“This is a true restructuring of the operations and profile of this business, when the first bankruptcy was not,” Chief Executive Dave Davis said in an interview. Davis was tapped for CEO in April, a month after Spirit exited its first bankruptcy.
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Raistone Files for Chapter 7 Liquidation Following First Brands Collapse
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Trade financier Raistone Capital filed for chapter 7 liquidation after it was caught up in auto-parts maker First Brands Group’s bankruptcy.
The company and an affiliate sought protection in the U.S. Bankruptcy Court in New York, according to a chapter 7 petition signed by CEO David Skirzenski. Raistone's fall traces back to the September bankruptcy of First Brands, which had borrowed billions of dollars in off-balance sheet financing backed by customer invoices.
A Raistone affiliate said in court papers last year that it was owed more than $172 million in purchased receivables related to First Brands. First Brands recently laid off most of its corporate workforce and has been teetering on the brink of liquidation.
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Blue Owl Fallout Sets Off Retail-Investor Panic. Their Advisers Are Urging Calm.
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Robert Hendricks immediately emailed his wealth adviser after seeing headlines on X saying Blue Owl Capital was halting redemptions in one of its private-credit funds.
His adviser told him he was invested in a different Blue Owl fund, and that the fears around headlines were overblown. He plans to redeem the roughly $75,000 he has invested anyway.
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Hendricks is among the individual investors who have piled into private-credit funds in recent years and are now wondering whether they made a mistake. The latest cause for concern: Blue Owl, a private-credit juggernaut, said last week it was selling $1.4 billion in loans to give money back to investors in certain older funds and ending quarterly redemptions for one of them.
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Private Equity Was Headed for a Correction, Even Without AI Gloom
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The market may eventually talk itself down from some of the worst fears about artificial intelligence disruption of software companies. But investors shouldn’t expect private asset managers to bounce right back to where they were.
As owners of, and lenders to, software companies through their funds, the largest private asset managers have seen their shares sink alongside big swaths of the rest of the market in recent sessions. Perhaps surprisingly, though, the correction in many of these managers’ shares has actually been sharper, especially when viewed through a longer time horizon.
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