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Saturday, April 13, 2024

Tech’s Cash Crunch Sees Creditors Turn ‘Violent’ With One Another

 

  • Software and services nears $30 billion of distressed debt
  • Percentage of companies defaulting more than once is rising

The relentless rise of the Magnificent Seven makes it easy to forget that many tech firms are unprofitable and struggling with their debt burdens. Now, creditors in the space are turning against one another in a bid to get repaid.

Alvaria Inc., GoTo Group Inc. and Rackspace Technology Inc. are among a spate of troubled tech companies to agree to restructuring deals this year that provide select lenders with better terms on debt swaps than others, a process sometimes deemed a form of ‘creditor-on-creditor violence.’

https://www.bloomberg.com/news/articles/2024-04-13/tech-crunch-sees-creditors-turn-violent-to-get-repaid-credit-weekly

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