Logistics company Ceva Logistics has moved to reassure its customers that the company is not about to go bankrupt.
Earlier this month it was reported that Ceva, which is thought to be Primark’s primary logistics provider, had its credit rating downgraded by ratings agency Standard & Poor’s (S&P), from B-minus to SD (selective default) after failing to meet scheduled interest payments.
However chief executive Marv Schlanger told Drapers that the company was undergoing refinancing, which would result in a “better balance sheet”.
Schlanger explained that the business is undergoing a recapitalisation in which it will eliminate more than €1.2 billion of consolidated net debt. “We are pleased that a substantial majority of our creditors have already committed their support,” said Schlanger.
“During this process we have financial capability to operate business as usual.” He added that customers and suppliers have been kept fully informed of the procedure.
Despite Standard & Poor’s (S&P) and Moody’s downgrading of Ceva’s credit rating Schlanger said this had been predicted and was part of the overall tactic. He added: “We anticipate [the ratings] will go up again after the recapitalisation.”