The advisers to the bondholders that provided lender CIT Group Inc
CIT has started a cash tender offer for its outstanding floating rate senior notes due August 17, exchanging $825 for each $1000 principal amount.
But even if CIT manages to get 90 percent of those notes swapped at a discount, advisers will push for a pre-packaged bankruptcy and have CIT restructure out of court, Jeffrey Werbalowsky, the co-CEO of Houlihan Lokey Howard & Zukin, the investment bank advising the bondholders, told them on Wednesday, according to the person cited by Bloomberg.
Earlier this week, bondholders provided CIT with the emergency loan, allowing the 101-year-old lender to small and mid-sized businesses to stave off the threat of imminent bankruptcy.
Werbalowsky and CIT spokesman Curt Ritter didn't immediately return calls seeking comment.
(Reporting by Phil Wahba; Editing by Gary Hill)