Walter Investment Management Corp. has reached a deal with its biggest banks that includes a restructuring — sending shares of its stock tumbling.
An announcement late Tuesday from the Fort Washington, Pennsylvania-based company indicated that it has entered into a
restructuring support agreement.
The agreement is with senior lenders that held more than half of Walter Investment’s loans and commitments outstanding as of July 31.
“After careful consideration, we have taken a significant step to improve Walter’s financial position,” Walter Investment
President and Chief Executive Officer Anthony Renzi stated in the news release. “The actions we have taken, combined with the support of our existing lenders, should help us strengthen our balance sheet and position Walter for a sustainable future.”
Included in the restructuring is an extension until June 2022 for the maturity of a 2013 amended and restated credit agreement.
The deal got Walter a waiver of default events,
“including those arising as a result of the company’s previously announced restatement of certain of its financial statements due to an error in the company’s calculation of the valuation allowance on its deferred tax asset balances, and an amendment to the credit agreement to make certain changes to the mandatory prepayment provisions and negative covenants thereof and certain technical changes.”
The company also got a default waiver from a group of senior note holders and hopes to negotiate restructuring support from a sufficient share of senior note holders.
Shares of Walter plunged 32 cents — or 39 percent — Wednesday to 51 cents.
