Greensill Capital plans to file for insolvency this week

Greensill Capital is planning to file for insolvency in the United Kingdom this week, according to The Wall Street Journal, citing sources familiar with the matter.

The proposed insolvency filing would enable private equity company Apollo Global Management to purchase the appealing parts of the company, according to the reports.

Greensill's owners, such as SoftBank's Vision Fund, will certainly be wiped out if an agreement with Apollo were struck. The Japanese conglomerate's $100 billion technology fund invested $1.5 billion in the company in 2019, but has now written down the valuation of its interest significantly, The Financial Times reported.

Greensill is a global provider of working capital financing for companies and individuals. According to its website, it has issued over $143 billion in financing to over 10 million consumers.

Greensill provides supply-chain finance, which is a form of short-term cash advance that allows businesses more time to pay their suppliers. Blue-chip corporations and government departments such as the National Health Service of the United Kingdom, AstraZeneca PLC, and Ford Motor Co. are among them.

Credit Suisse suspended $10 billion in investment funds that Greensill depends on to do supply-chain financing transactions, plunging the company into crisis on Monday.

Founded by Lex Greensill in 2011, the company is headquartered in London and has offices in New York, Chicago, Miami, Frankfurt, Bremen, and Sydney. It employs over 800 people worldwide.

Greensill offers Supply Chain Finance to clients in Europe, North America, Latin America, Africa, and Asia, and collaborates with several banks and institutional investors to provide reliable financing.

Moreover, Lex founded and led Morgan Stanley's global supply chain finance team before founding Greensill, as well as successfully developing supply chain finance activities for Citibank.

On Tuesday, Greensill's German subsidiary has been put under the monitoring by financial watchdog BaFin, Financial Times reports.

(With inputs from The Wall Street Journal)