Debt Resolution – Reduced debt settlement following the sale of the loan to a venture capital firm

After the bank sold their loan to a venture capital firm, a business was faced with a demand for full repayment of the debt, despite having never missed a loan repayment. The venture capital firm appointed LPA Receivers to take control of the property portfolio and the directors were faced with the loss of their business and a potential claim on a personal guarantee.

Our review of the banking relationship highlighted a number of concerns which could impact upon both the LPA Receivership appointment and the validity of the guarantee itself.

We assisted the directors in setting aside a statutory demand made by the venture capital firm and ultimately successfully negotiated a settlement for £2.1m which included the return of the property portfolio to the directors – a client saving of approximately ₤600k.