Get 40% Off
🚨 Volatile Markets? Find Hidden Gems for Serious Outperformance
Find Stocks Now

FTX begins strategic review, seeks court relief to pay critical vendors

Published 11/21/2022, 05:07 AM
Updated 11/21/2022, 05:12 AM
© Reuters. FILE PHOTO: The logo of FTX is seen on a flag at the entrance of the FTX Arena in Miami, Florida, U.S., November 12, 2022. REUTERS/Marco Bello/File Photo

(Reuters) - Collapsed crypto exchange FTX said on Saturday it has launched a strategic review of its global assets and is preparing for the sale or reorganisation of some businesses.

FTX, along with about 101 affiliated firms, also sought court relief to allow the operation of a new global cash management system and payment to its critical vendors.

The exchange and its affiliates filed for bankruptcy in Delaware on Nov. 11 in one of the highest-profile crypto blowups, leaving an estimated 1 million customers and other investors facing total losses in the billions of dollars.

FTX will explore sales, recapitalisations or other strategic transactions for some of its units, the company's new Chief Executive officer John Ray said in a statement.

In a court filing on Saturday FTX asked for permission to pay prepetition claims of up to $9.3 million to its critical vendors after an interim order and up to $17.5 million after the entry of the final order.

The exchange said that if it fails to receive the requested court relief, it will result in "immediate and irreparable harm" to its businesses.

"Based on our review over the past week, we are pleased to learn that many regulated or licensed subsidiaries of FTX, within and outside of the United States, have solvent balance sheets, responsible management and valuable franchises," FTX's Ray said.

FTX has identified 216 debtor bank accounts with positive balances as of Nov. 16, but has only been able to verify the balances in 144 accounts so far, the company said in a separate court filing.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

The company has appointed Perella Weinberg Partners LP as its lead investment bank to help with the sale process, subject to court approval.

Latest comments

Why should the critical vendors get paid before investors or customers and what new payments system?
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.