Cloud 9fin The Ardagh LME origin story
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Apr 1, 2025 Emmet McNally, a European senior distressed credit analyst at 9fin, shares insights on the tumultuous past of Ardagh's metal packaging carve-out in 2021. He and Max Frumes discuss its implications for creditor negotiations and the ensuing lawsuits over alleged value extraction. The duo delves into the complex dynamics between the company and its unsecured bondholders, exploring how to bridge the gap between competing proposals. Listeners get a peek into the intricate world of finance, navigating litigation and restructuring challenges in Ardagh's ambitious journey.
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Ardagh's Restructuring History
- Ardagh, a packaging company, restructured multiple times, separating its metals and glass businesses.
- The metal cans business, listed on the NYSE, performed better than the privately held, over-levered glass business.
Ardagh Glass Creditors' Distress
- Ardagh Glass creditors face significant discounts and distress due to the company's restructuring.
- The value disparity between the metal and glass businesses contributes to the creditors' difficulties.
Value Diversion from Ardagh Glass
- Ardagh Glass creditors lost value due to asset transfers, including a $1 billion diversion from the $3.4 billion received from the metal packaging carve-out.
- Shareholders, including Paul Coulson, received dividends from this diverted amount.