BrightHouse will not be taken over by creditors later this year, as rumoured, but will start to deleverage debt in May 2018, according to a senior source.
The rent-to-own company, owned by private equity firm Vision Capital, has allegedly sold some of its debt to Apollo Global Management but a source said they hadn’t bought “too much”.
Bondholders of BrightHouse have reached out to debt restructuring specialists PJT Partners who will work with them when it’s time to deleverage the debt.
The senior source also said the company is “fine, it just needs to get rid of some debt”, but it won’t begin this process until it has amended its business plan.
The need for amends follow the crackdown on rent-to-own by the Financial Conduct Authority (FCA). The regulator launched an investigation into hire-purchase companies and rent-to-own products in November last year and is due to launch its findings soon.
In its most recent account filings, BrightHouse said it has tightened its customer acceptance criteria and embedded a more detailed and extended affordability assessment.
BrightHouse has £80m of cash on its balance sheet, but declined to comment on this matter.