Babel Finance is Reportedly Looking to Hire Restructuring Specialist Houlihan Lokey
- Babel Finance halted the transfer of funds to prevent the organization from sliding into liquidation.
Babel Finance has hired U.S. investment banking firm Houlihan Lokey to deal with its liquidity crisis, according to people familiar with the matter.
Notably, one of the sources indicated that the organization is on a recovery path, and part of its plans includes employing Houlihan Lokey. While emphasizing that both Houlihan Lokey and the organization are on the verge of going into an agreement, the source refused to disclose if Lokey has been employed or not.
“Babel is looking at restructuring. They’ve hired Houlihan Lokey or are in the process of hiring them. They’re in the process of signing an engagement letter,” one source confirmed.
Reportedly, one of the sources divulged how Babel Finance is working on a big announcement a few days from now. The source expressed optimism about the firm’s intention of overcoming its current financial crisis.
Babel Finance and Others Struggle With Liquidity
Recently, Babel Finance halted the transfer of funds to prevent the organization from sliding into liquidation. However, the firm eventually came out to reveal its consensus with some organizations in the crypto sector on how to service its loan and reduce liquidity.
Notably, Babel has decided to follow in the footsteps of other firms in the crypto space that are facing the same difficulties. Currently, both Celsius and Three Arrows Capital are languishing in a pool of financial catastrophe. Three Arrows Capital has been trending in the cryptocurrency sphere lately, not for good reason but a poor one.
Within the week, 3AC received a query from the Singaporean authority for manipulating information about assets under the management of the firm. Meanwhile, a court in the British Virgin Islands also declared the liquidation of 3AC due to the current financial troubles of the organization.
The foregoing led to unrest among investors who had previously lent out some money to the firm. Subsequently, the investors are growing concerned about who and how the firm will repay the loan.
Before then, a notable crypto broker, specified as Voyager Digital, issued a defaulting query to 3AC over its failure to service some of the organization’s loans. Voyager confirmed that the loan is around 15,250 BTC, which amounts to $324 million and about $350 million USDC.
Similarly, Celcius also halted the withdrawal of funds from its phantom due to the dip that has ransacked the cryptocurrency space. A development that has incited a wave of unrest among members of its community, with many bemoaning the firm’s lackluster approach towards engaging the community about the situation.
As plans to steer away from the crisis, these firms have hired experts and advisers, just like Babel Finance, Celcius employed Alvarez and Marsal including lawyers from Akin Gump Strauss Hauer and Feld.
As of press time, both Bable Finance and Houlihan Lokey are yet to announce this plan. Nevertheless, Stakeholders in the crypto industry are monitoring the situation to see how well the firm can handle the situation.