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Getty Images Reportedly in Talks with Lenders for Rescue Financing
Summary
The stock-image company is in confidential discussions for new financing, potentially including a debtor-in-possession loan, after missing a September interest payment, according to a Bloomberg report.
Getty Images Holdings Inc. is in confidential talks with its lenders to secure new financing as it grapples with significant financial pressure, according to a report from Bloomberg. The discussions reportedly include the possibility of a debtor-in-possession (DIP) loan, which would suggest a potential bankruptcy filing is being considered.
Details of the Negotiations
The ongoing talks are exploring several outcomes for the struggling photo archive company. Lenders are considering taking control of Getty Images through a bankruptcy process, while the Getty family is also weighing a contribution of new funds as part of a potential deal, Bloomberg reported. No final decisions have been made as the negotiations are ongoing.
To navigate the complex discussions, Getty has hired advisors:
- Investment Bank: Guggenheim Securities
- Legal Counsel: Simpson Thacher & Bartlett
AdLender groups have also retained their own counsel, with secured lenders engaging Houlihan Lokey and Gibson Dunn & Crutcher, and a group of unsecured creditors retaining Akin Gump Strauss Hauer & Feld.
Mounting Financial Pressure
The move for new financing follows Getty's decision to miss an interest payment on its unsecured notes that was due September 1. The company entered a 30-day grace period, stating in regulatory filings that while it had sufficient cash for the payment, it chose to use the grace period to explore its options. As of June 30, Getty carried more than $1.3 billion in debt.
Credit rating agencies have responded to the increased financial risk by downgrading the company's debt. In September, S&P Global Ratings cut Getty's rating to CCC after a planned merger with Shutterstock Inc. collapsed in July. Moody's followed with a two-notch downgrade to Caa3, citing expectations of further liquidity deterioration without a cash injection or debt restructuring. The company's stock has lost more than 99% of its value since its public listing.
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