PLUTOS SAMA, VION PRESENT PLN 1.3BN HIGH BID ON POLISH NPLS, AND LOSE
The top bid for assets of troubled Polish debt collector GetBack SA this month was relegated to a backup offer by the company and a creditors group overseeing its restructuring, according to two sources familiar.
A consortium of distressed debt investors including Plutos Sama Holdings, Inc., Vion Investments and Schottentor Capital bid PLN 1.3bn (USD 341.3m) for Polish NPLs sold as part of the planned restructuring of GetBack, which has been dogged this year by corporate bond defaults, losses and alleged corruption by executives, the first source said. Fortress Investment Group also had an interest in the bid, the source said.
The group bid, which promised about PLN 700m upon closing, was passed over for a PLN 1.2bn offer from Stockholm-based NPL buyer Hoist Finance, the first source familiar said. Hoist was said to have promised PLN 950m of the offer within two years, a commitment that apparently swayed GetBack’s creditors, the source said.
A telephone inquiry to Hoist was referred to a company email. Emails to the company’s general address and its spokesperson were not returned. A GetBack spokesperson declined to comment.
Sales of the assets would be a large step in the restructuring of GetBack, a company formed in 2012 by Polish billionaire Lescek Czarnecki and later acquired by Abris Capital Partners. The company, which funded NPL purchases with billions of zloty raised through unsecured corporate bond sales, became embroiled in scandal after missing debt payments, delaying an earnings report and then reporting a larger-than-expected PLN 1.3bn loss for 2017.
GetBack’s unfolding story comes against a backdrop of growing local and international interest in profiting from Eastern European NPLs. GetBack was a significant player in what had become a “very hectic” market where domestic companies were jockeying with foreign servicers and distressed funds for the assets, said Lech Gilicinski, head of the K&L Gates’ banking, finance and restructuring practice in Warsaw.
In Poland alone, NPLs could be PLN 30bn–40bn, “or even more than that,” Gilicinski estimated. He declined to comment on GetBack’s restructuring.
GetBack targeted NPLs aggressively. It became Poland’s fastest growing accounts receivable manager with total nominal value of assets quadrupling to PLN 19.4bn in the three years through 2016, its website shows. Among notable acquisitions with PRA Group, a US-based debt collector, was a portfolio with a nominal value of PLN 2bn from Getin Noble Bank, where GetBack founder Czarnecki is chairman, according to the website.
But GetBack accumulated NPLs at prices at above-market prices, according to news reports and the first source familiar. In one example, Dziennik Gazeta Prawna reported on 8 November that GetBack paid Bank Pekao PLN 148m for a nominal PLN 1.2bn NPL package that it had previously valued at PLN 66m.
Hoist’s acquisition is subject to the approval of a settlement plan by GetBack’s creditors, Hoist said in a 7 November statement. The cash would cover secured debts of approximately PLN 700m but fall far short for unsecured creditors holding more than twice that amount, the first source familiar said.
The US-based investor consortium left its GetBack bid on the table should there be any issues with Hoist’s offer, the source said. GetBack also bought Romanian NPLs and those assets may be sold in a separate auction, the source said. by Al Yoon
May 29, 2021