Getty Images has secured support for a major debt restructuring deal. The visual-content company said on Monday that its major creditors and investors had agreed to support a plan to reduce its debt, raise fresh money and take the company private.
The company will receive up to $533 million in fresh equity. Affiliates of the Getty family and Koch Equity Development have committed to invest up to $533 million in the company under the restructuring support agreement, as reported by Reuters.
Getty Images to cut debt
The deal will help Getty Images reduce its debt burden. The restructuring plan includes changes to the company’s existing debt, fresh investment and steps to lower its borrowing costs.
Holders of $270 million in unsecured bonds have agreed to retire their notes. This means the bondholders have agreed to cancel or eliminate these debt claims as part of the restructuring plan, helping Getty Images reduce its debt.
Getty Images loan costs
Secured lenders have also agreed to changes in their loans. They have agreed to reduce interest costs and extend the time Getty Images has to repay its debt. This will help the company lower its borrowing expenses and get more time to repay its loans.
Getty family to own Getty Images
The Getty family and Koch Equity Development will own the entire reorganized company. Once the restructuring is completed, affiliates of the Getty family and Koch Equity Development will own 100% of Getty Images, as reported by Reuters.
Getty Images plans to go private through a Chapter 11 bankruptcy process. The company plans to use an expedited, prepackaged Chapter 11 process involving certain US entities. This approach allows a company to seek court approval for a restructuring plan that has already been negotiated with key creditors.
The company expects the restructuring to be completed by the end of 2026. Getty Images said it expects to complete the transaction by year-end. The plan will need to move through the required restructuring process before it is completed, as reported by Reuters.
Getty Images Shutterstock merger
The announcement comes months after Getty Images abandoned its planned merger with Shutterstock. Getty Images had planned a $3.7 billion merger with its rival, Shutterstock, but the deal did not go ahead.
UK competition concerns played a role in the failed merger. Britain’s Competition and Markets Authority required Shutterstock to sell its editorial business as a condition for approving the merger. Getty Images and Shutterstock subsequently abandoned the planned transaction.
