The bills for lawyers and administrators to wind down Greensill Capital’s UK business are expected to come in at more than £30m for their first year of work alone, new filings show.
Insolvency experts from Grant Thornton, which was appointed as administrator, have been charging £562 an hour, and racked up £2.9m in fees by mid-April. However, the administrators’ report suggests those charges could climb to £15m by March next year.
Administrators are prioritised for payouts ahead of unsecured creditors.
The Grant Thornton fees are on top of an estimated £12m-£16m in legal fees, potentially bringing total professional charges linked to Greensill’s UK collapse to nearly £31m for 12 months’ work.
Three law firms have been recruited to help with the administration, including Simmons & Simmons, Herbert Smith Freehills and so-called magic circle firm Allen & Overy.
The complex nature of Greensill’s operations means the administration is likely to drag on for several years, resulting in tens of millions of pounds more in fees for experts working to wind down the lender’s operations in full.
About 200 unsecured creditors are owed nearly $1.46bn (£1bn) from Greensill’s estate. That includes $500m for insurers including Swiss Re, Chubb and Bond & Credit Co. The latter was a key trade insurer owned by Tokio Marine that pulled its cover for Greensill’s packaged loans last year, prompting the financial crunch that eventually led to the lender’s collapse.
The documents released on Friday also show that Grant Thornton was drafted in to give Greensill financial advice at the end of 2020, as it tried to put together a last-ditch restructuring programme, sell the business and eventually plan for its wind-down. The failed sale resulted in Grant Thornton being appointed as administrators on 8 March.
Grant Thornton and Allen & Overy declined to comment. The Guardian also approached Simmons & Simmons, Herbert Smith Freehills for comment.