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UK: The board of directors at lifestyle hospitality company Selina have filed a statement with the Securities Exchange Commission (SEC), stating it “no longer has any reasonable prospects of avoiding an insolvency”.
On 22 July 2024, Selina appointed Andrew Johnson, Samuel Ballinger and Ali Khaki of FTI Consulting LLP as joint administrators.
Selina was valued a $1.2 billion in 2021, when it announced the company would go public via a SPAC merger with BOA Acquisition Corp.
According to a document submitted to the SEC, Selina failed to repay a $50 million loan to IDB Invest, and it did not make an interest payment of $455,000 which was due on 15 July 2024.
Due to the breach, IDB Invest currently holds “collateral arrangements over many of the group’s assets in Latin America”.
Selina will also be delisted from Nasdaq as a result filing for administration.
Johnson, senior managing director at FTI Consulting, said: “Unfortunately, the company was unable to reach its growth aspirations following the COVID-19 pandemic. The group subsequently struggled to raise sufficient capital to deliver a turnaround due in a large part to increased interest rates and weaker trading performance.
“The joint administrators are considering options for the company on an accelerated basis and we will continue to support regional management where possible to minimise disruption to guests, employees and other stakeholders. However, as a result of the insolvency, Selina Hospitality PLC is unable to continue to provide financial support to the company’s subsidiaries,” he added.
Options available to Selina may include a sales process of some or all of the operating subsidiaries and other assets of the group, subject to obtaining the necessary funding to run such a process.
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