US Special Situations: First Brands minority lender group forms amid non-pro rata DIP concerns
Veronica Graff - Reporter, LevFin Insights
Peter Agra - Senior Reporter, LevFin Insights
Chris Donnelly - Managing Director, LevFin Insights
24 September 2025
Insights into First Brands’ non-pro rata DIP financing and its implications for lender dynamics, liquidity, markets, and credit risk, including:
- Minority group forms: Why a lender cohort is organizing now.
- DIP size and structure: What a $1.0bn–$1.5bn facility with roll-ups could mean for access and economics.
- Steerco dynamics: Which large holders are leading and how terms could differ.
- Liquidity pressures: How heavy factoring and supply chain financing shape the risk picture.
- Market and ratings context: What sliding loan prices and Caa1/CCC+ downgrades signal about near-term stress.
A minority cohort of First Brands lenders has retained Glenn Agre for legal advice as the automotive aftermarket supplier’s efforts to line up as much as $1.5bn in DIP financing stoke fears that participants will not all be offered the same terms, sources tell LFI. Glenn Agre currently represents over $100mn of first-lien lenders, they continued. Lenders organized with Gibson Dunn and Evercore have been sounding out the possibility of providing $1bn-$1.5bn in DIP financing, a portion of which is expected to include a roll-up of existing 1L holdings, according to sources familiar with the matter. Questions remain over the economics and whether access to the loan will be open on a pro rata basis or if steerco creditors will receive premium terms, sources noted.
