Private equity-owned Secure Home Holdings LLC filed for bankruptcy protection after its top-ranking lenders agreed to award themselves the home security systems business, leaving suppliers and other unsecured creditors owed $110 million unpaid, WSJ Pro reported. The terms are proposed in a “prepackaged” chapter 11 reorganization plan that Secure Home filed Monday, shortly after the Sunday bankruptcy filing. Ballots haven't been cast yet, but top lenders, led by affiliates of Invesco Ltd., have agreed to cancel part of their debt in exchange for ownership of Secure Home. Bank lenders are owed, in the aggregate, about $197 million, a figure that includes unspecified fees and costs, according to court papers. Funds managed by Oaktree Capital Management mostly own Secure Home, with Ironwood Capital and Alcentra Capital Corp. as minority stakeholders. Oaktree declined to comment. Prepackaged bankruptcies normally involve advance voting by creditors that stand to lose something under the proposed plan. Secure Home hasn’t formally polled its senior lenders, but said they have agreed to the proposed debt-for-equity swap plan. Under its proposed chapter 11 plan, Secure Home wouldn’t be handing out ballots to unsecured creditors or second-lien lenders, even though both groups stand to lose all. Investment banker Raymond James & Associates Inc. estimates the company has an enterprise value of about $145 million, less than the amount it owes senior lenders.
