Junior creditors to auto supplier Garrett Motion Inc. are preparing a rival proposal to provide the bankrupt company with financing for its restructuring, according to people with knowledge of the matter.
The group of bondholders organized and is in the process of hiring investment bank Moelis & Co. to represent them in the case and submit an offer for a debtor-in-possession loan, the people said, asking not to be identified discussing a private matter. The group is getting legal advice from Ropes & Gray, Bloomberg previously reported.
Garrett filed bankruptcy this week, struggling to deal with a pandemic-related slowdown in business on top of asbestos liability reimbursements it owes to its former parent Honeywell International Inc. The payments Garrett owes to Honeywell relate to asbestos claims stemming from Honeywell’s old Bendix brake business.
Representatives for Garrett and Moelis declined to comment.
The original $250 million bankr…