Greensill’s administrators recover additional £41m for creditors

Greensill’s administrators have recovered additional funds of £41 million for the creditors of the finance firm which collapsed amid an outcry over its lobbying of government officials.
The restructuring advisers managing Greensill’s insolvent estate have reported recouping the funds in their latest report to creditors on their activities during the six months ended September 7.
Grant Thornton has told creditors that it will need to extend the time required to unwind Greensill assets from an initial date of March 7 2025, but that the amount available for repayment to unsecured creditors was “uncertain at this stage”. Greensill’s directors had estimated that unsecured creditors had claims of more than $1.6 billion against the company, but Grant Thornton said some creditors had “lodged claims of significant value in excess of the directors’ estimates”.
Greensill fell into administration in March 2021 and the insolvency revealed that David Cameron, the former prime minister, lobbied government officials to secure contracts for the firm. Credit Suisse, the Zurich-based lender rescued by UBS last year, had built up a $10 billion exposure to the finance firm, and has been trying to recoup its losses in the year since the collapse.
Chris Laverty, restructuringpartner at Grant Thornton, said in the report that progress has been made to prepare legal lettersto send to third parties demanding contributions for the losses sustained by creditors in Greensill’s collapse. The joint administrators are also investigating the affairs of the company in the lead-up to its demise, while also assisting other investigations into the Greensill case.
Laverty’s report outlined that Sanjeev Gupta’s GFG Alliance still had an outstanding balance with Greensill of $587 million. The steel conglomerate has been in negotiations with Greensill’s administrators about repaying the sums, but Laverty’s report said the administrators are considering other strategies to recover the funds. The report said it could not outline the details of its plans as it could prejudice recovery efforts, and that a separate insolvency advisor had been brought in to oversee the process.
The Greensill scandal has spawned a number of legal disputes as the parties involved in financing its operations seek to avoid liability for the firm’s losses or try to secure funding from the group’s insolvent estate. Zurich, the insurance firm, has been seeking to show it it does not need to pay out on insurance policies agreed with Greensill’s defunct German banking unit, and Marsh, the insurance firm, has been sued by White Oak, a US finance group, over its handling of insurance cover for the defunct supply chain finance firm.
In March, the government launched a bid to ban Lex Greensill, the firm’s founder, from holding company directorships. The Insolvency Service said it had commenced director disqualification proceedings at the High Court. The government issued a statement saying that it had now filed the case at court seeking a ban of “up to 15 years”, the maximum term. It was unable to reach an agreement with him over his disqualification via a settlement, a common way of avoiding taking such proceedings to court.
However, Greensill said he had sued the government, citing concerns about how it had conducted an investigation of his affairs. He said at the time that he rejected the action from the government as “wholly without merit” and that he would “robustly address it”.