(Bloomberg) -- Bluestone Resources is offering Credit Suisse Group AG $300 million and half the value of its business in order to settle debts tied to loans made by Greensill Capital.
The U.S.-based mining company, which is owned by the family of West Virginia Governor Jim Justice II, was loaned around $850 million by Greensill Capital, and much of that debt ended up in funds run by Credit Suisse. Bluestone recently proposed to pay $300 million in cash by refinancing part of the Greensill debt and promised half the proceeds of a future sale of the mining firm, according to a person familiar with the matter.
The Wall Street Journal reported the news earlier on Monday.
“I think it’s pretty accurate,” Jim Justice said at a press briefing for local journalists on Monday, in response to the Journal story. “We got the rug just jerked right out from underneath us with the Greensill folks.”
Bluestone had become one of Greensill’s biggest clients in recent years, and $690 million worth of debt ended up in the Credit Suisse funds, according to disclosure from the Swiss lender. Credit Suisse is in the process of winding up the four vehicles, which also include loans to Sanjeev Gupta’s GFG Alliance and failed builder Katerra Inc.
“Credit Suisse Asset Management is doing everything we can to maximise recovery for our fund investors,” Credit Suisse said in an emailed statement. “If outstanding debtors put proposals to us, we will of course look at them.”
Bluestone is suing Greensill Capital and its founder Lex Greensill in a New York court. In the lawsuit, Bluestone claims that it was unaware of the London-based lender relationship with Credit Suisse before Greensill collapsed in March. Some Justice family members, including the governor, made personal guarantees on some of the loans.
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