Greensill Clients Await Apollo Rescue

Lex Greensill

Corporate clients of troubled SCF lender Greensill are waiting to see if a proposed purchase of some of its operating business by New York-based private equity firm Apollo Global Management could offer them a lifeline.

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Without the rescue, funding for supplier finance programmes could disappear, leaving at least 40 companies scrambling for the cash to pay suppliers.

Greensill, founded by Lex Greensill (pictured) was once the ‘big beast’ of the supply chain finance sector but now faces insolvency after the withdrawal of insurance backing for its loans prompted key funders of its SCF programmes, such as Credit Suisse and GAM, to pull out.

Greensill timeline

2020

• Bond and Credit Company decides not to renew insurance policies covering $4.6 billion in corporate loans backed by Greensill. They are due to lapse on 1st March 2021
• Greensill goes to court in Australia seeking an injunction preventing Bond and Credit from withdrawing cover. It argues that losing insurance coverage for its clients could cause defaults and put 50,000 jobs at risk.

March 2021:

• A  Sydney judge strikes down Greensill’s attempt to gain an injunction
• Hours later, Credit Suisse Group suspends $10 billion worth of funding for Greensill Capital
• GAM Holding announces it will end dealings with Greensill, closing its $842 million GAM Greensill Supply Chain Finance Fund and returning investors’ money
• Greensill Bank in Germany is taken under control of the German financial regulator, BaFin
• Greensill seeks insolvency protection in Australia
• The Wall Street Journal reports that BaFin, has referred the Greensill case to criminal prosecutors.
• Greensill is reported to be preparing to file for insolvency in the UK ​

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