(Reuters) – Private equity firm Carlyle Group has told creditors it would pay $36 million to keep control of IMO Carwash, in exchange for its creditors writing off debt, the Financial Times said.
It would be the second time Carlyle has had to pump money into IMO Carwash, the paper said.
Last spring Carlyle injected 25 million pounds ($36 million) in the form of a loan, which paid interest in kind rather than cash, in exchange for creditors giving the company extra breathing space on its covenants, according to the paper.
IMO, which describes itself as the largest carwash company in the world, has struggled to sustain its 355 million pound ($509 million) debt, the paper said.
As a result it has breached covenants and the sponsor wants senior ranking creditors to cut their debt claims by a third and junior creditors to write off all their debt, in exchange for equity stakes, according to the paper.
Carlyle would keep majority control, the paper said, adding that this was a first offer by Carlyle, which creditors have yet to accept.
Carlyle could not be immediately reached for comment by Reuters. ($1=.6967 Pound)
(Reporting by Ajay Kamalakaran in Bangalore, editing by Will Waterman)