Jan 6, 2020

Security contractor Constellis in talks for $1 billion debt restructuring

Last week's storming of the U.S. embassy in Baghdad. Photo by Murtadha Sudani/Anadolu Agency via Getty Images.

Constellis, a Reston, Va.-based security contractor owned by Apollo Global Management, is in talks with creditors to restructure its $1 billion of debt or enter a pre-negotiated bankruptcy, per Bloomberg.

Why it matters: Constellis is partially responsible for security at the U.S. embassy in Baghdad, which came under assault last week — possibly precipitating the U.S. decision to kill Iranian Gen. Qassem Soleimani.

Backstory: The company missed a principle payment on December 31, but entered into a forbearance agreement so it could continue operations. All of this is a far cry from early 2018, when Apollo was negotiating to sell or IPO Constellis.

Bottom line: "The company, which bought what was once Blackwater, the private-security firm founded by Erik Prince, has struggled as the U.S. scaled back operations overseas. Domestic work came with lower margins and the company has been bogged down with start-up costs on new contracts, S&P Global Ratings said in a report in November as it cut the company’s credit grades." — Bloomberg

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Dairy producer Borden files for bankruptcy

Borden, a Dallas-based milk and cheese producer founded in 1857, has filed for Chapter 11 bankruptcy protection.

Why it matters: This is the second major U.S. dairy to go bankrupt in the past two months, following market leader Dean Foods, with blame being placed on everything from declining milk consumption to truck driver shortages.

Go deeperArrowJan 7, 2020

The world's fast-growing mountain of debt

The world's total debt surged by some $9 trillion in the first three quarters of 2019, according to data from the Institute of International Finance, bringing the world's total debt load to $253 trillion, or 322% of its GDP — a record high.

Why it matters: In times of economic strength, economists exhort countries to pare back their debt burdens and pay it down to protect against future unrest and downturn.

Go deeperArrowJan 13, 2020

World Bank cuts growth forecast for fourth time in a row

Photo: Win McNamee/Getty Images

The World Bank cut its global growth forecast for the fourth straight time on Wednesday, reducing expectations by 0.2 percentage points each year for 2019, 2020 and 2021.

"Global economic growth is forecast to edge up to 2.5% in 2020 as investment and trade gradually recover from last year’s significant weakness but downward risks persist. ... U.S. growth is forecast to slow to 1.8% this year, reflecting the negative impact of earlier tariff increases and elevated uncertainty."
— World Bank statement on its Global Economic Prospects report
Go deeperArrowJan 9, 2020