Cerba Bank Debt for Sale as $5.8 Billion Restructuring Progresses

Cerba Healthcare, backed by EQT AB, has filed a request for court-supervised restructuring proceedings in France to manage its approximate €5 billion ($5.8 billion) debt. This move, announced in an earnings presentation to creditors, aims to create a structured environment for discussions regarding the company's financial obligations. The commercial court handling this is the Tribunal des Activités Économiques de Nanterre.

The company is currently engaged in pricing discussions with France's National Health Authorities, anticipating initial results by the end of the current month. These talks are crucial as the French government provides subsidies to private laboratories through tariffs for medical tests, and a supervisory body had previously recommended reducing reimbursement levels. In April, Cerba had informed lenders that clarity on pricing was expected by May or June.

S&P Global Ratings, in July, had deemed Cerba's debt as "unsustainable" and projected a default within the next six months due to the company's "tight liquidity position and weak cash flows." To help mitigate this, Cerba secured an extension on interest payments until November. Earlier in the year, private equity backers provided a €100 million loan to bolster the company's cash reserves. As of June, Cerba had access to approximately €108 million in cash.

Second-quarter results showed an EBITDA exceeding €122 million, representing about a 12% year-over-year increase, and revenues of approximately €469 million, up around 2%. However, the company's net debt stands at over €4.9 billion, which is nine times its earnings for the twelve months ending in June. This high leverage underscores the urgency for formalizing debt discussions and finding a viable restructuring solution. Prior to these formal proceedings, some lenders had already begun selling off portions of Cerba's bank debt, with a €30 million ($35 million) piece of its revolving credit facility trading at just under 70 cents on the euro in July 2025, signaling efforts to reduce exposure before official talks.