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Why is Citibank Taking Brigade Capital to Court?
What is the Citibank, Revlon and Brigade Capital controversy? Read more to find out.
So, this is what we know so far.
Revlon Inc. borrowed money from various lenders including Brigade Capital Management LP, HPS Investment Partners and Symphony Asset Management among others. Citibank acted as the administrative agent for the loan.
Revlon defaulted.
In mid of August this year, a wire transfer was made by Citibank to Brigade.
Brigade was supposed to receive $1.5 million in interest on loan principal of $174.7 million. Turns out, the wire transfer made was worth 100 times greater than the intended amount i.e. the actual payment made was $176.2 million!
Citibank is claiming it to be a clerical mistake and asking Brigade to repay the funds transferred in error. Brigade is refusing to do so.
They are saying that they will keep the money and regard it as “loan repayment”. And, this is why Citibank is taking Brigade to court.
The story is yet to unfold. But you have to agree that this is a peculiar situation even for a year like 2020.
What are your thoughts on this? Do you think Brigade is right or is it wrong?
