Credit Suisse is discussing a standstill agreement with steel magnate Sanjeev Gupta, increasing repayment chances.
Credit Suisse and steel magnate Sanjeev Gupta held advanced discussions over the long Ascension Day weekend related to a formal standstill agreement for the bank's remaining exposure to the GFG Alliance steel group.
The announcement said the standstill agreement is for GFG Australian subsidiary Liberty Primary Metals.
Credit Suisse had taken steps against Guptas companies in recent weeks and demanded that some be liquidated in the hope that it would be able to repay its fund clients. GFG still owes Credit Suisse $5.2 billion.
Gupta to Sell Assets
The standstill agreement will allow Liberty to be refinanced and restructured. It will sell the aerospace and special alloys steels business in Stockbridge, UK and has started the sales process for other non-core businesses.
The GFG Alliance is the largest debtor of the now insolvent Greensill Capital and Supply Chain funds co-managed with Credit Suisse. According to Credit Suisse, GFG still owes the funds $1.2 billion. The UK Serious Fraud Office is investigating the matter for suspected fraud, fraudulent trading and money laundering.
