Tuesday, July 8, 2014

Litigation Funding Helps Childcare Provider Settle Banking Dispute| Yahoo

-Yahoo Finance

July 7, 2014

Preeminent litigation funder Bentham IMF funded a claim for Australian childcare provider, ABC Learning, as they face a suits from lenders, the Federal Government, and employees after collapsing years ago into billion dollar debt. According to this article…

The liquidators of failed childcare provider ABC Learning have reached a deal with its lenders to help pay workers and reimburse the Federal Government.

ABC Learning collapsed almost six years ago with debts of $1.6 billion.No figure has been put on today’s settlement, but litigation funders Bentham IMF says the Federal Government will recover “millions of dollars” and both it and childcare workers should receive all of what they are owed.John Walker from Bentham IMF says it was a David and Goliath battle between small creditors and banks including CBA, NAB, Westpac and ANZ.”There was funding provided to ensure that the claim could proceed against all of the major trading banks in Australia,” he said.The claims arose because of a move by banks to create a floating charge to protect their security for loans made to ABC Learning.This charge was created in June 2008, a short time before the heavily indebted childcare provider collapsed, and it put the banks at the front of the queue to receive their money back before other creditors.ABC Learning had engaged in a rapid expansion in Australia and abroad using cheap debt but, as the global financial crisis hit and credit availability dried up, the company could not meet its large repayment burden.”


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