Credit Suisse hires Gilbert+Tobin for Greensill advice

Credit Suisse has a $140m loan to Greensill. Picture: AFP

Credit Suisse has hired law firm Gilbert + Tobin to advise on matters related to Greensill.

It comes after the Swiss investment bank earlier drafted in McGrath Nicol as receivers to recover a $140m loan owing to the Swiss investment bank.

Advisers are continuing to jockey for positions following the Greensill collapse this week.

Insolvency firm EY and law firm Clayton Utz are working with Australian steel company InfraBuild, owned by Sanjeev Gupta’s GFG Alliance.

Law firms working with Greensill are Herbert Smith Freehills and Allen & Overy.

Grant Thornton was appointed as the administrator of Greensill’s operations in recent days after being hit by defaults from GFG Alliance, and GFG is in talks with Greensill over a temporary repayments standstill.

Meanwhile, as revealed by DataRoom this week, PwC is advising Brookfield on a potential acquisition of the $1.5bn-plus InfraBuild.

Parties are also said to be circling InfraBuild’s US$325m worth of bonds.

InfraBuild also has US$250m of loans through a working capital facility to JPMorgan.

The Australian reported on Tuesday that court documents indicate that Greensill has about $US5bn ($6.5bn) worth of exposure to GFG.

The appointment of McGrath Nicol was made by Credit Suisse out of London because the loan is secured by an Australian entity that has a stake in Greensill.

Most of Mr Gupta’s business interests related to GFG are based offshore.

In Australia, Mr Gupta owns Infrabuild, which manufactures steel at its mini mills domestically and sells construction materials and, separately, the Whyalla steelworks in South Australia, for which maintaining profitability has historically been a battle.

Infrabuild is considered to be a strong performer at a time when steel prices are high.

An initial public offering of the business has been mooted for later in the year.

But as other parts of Mr Gupta’s empire come under financial pressure, advisers and lenders may insist on a sale of some of GFG’s strongest-performing assets.

Global buyout fund Apollo remains in talks to buy parts of Greensill, with Melbourne-based lawyer Leon Zwier of law firm Arnold Bloch Leibler on the ticket for the buyout fund.

As reported by The Wall Street Journal, Greensill’s operations were seized last week, when Credit Suisse stopped investors from moving money in or out of the $US10bn in supply-chain investment funds.

The Credit Suisse move was triggered after Greensill lost coverage from a set of credit insurers that provided protection in case the start-up’s clients defaulted.

The insurance was crucial because it made Greensill’s assets appear safer to Credit Suisse’s institutional investors.

Now the thinking is that insurers could also seek advice should they be on the hook for funds owed by Greensill’s clients that have defaulted on their loans.