“Word around the office is that the firm just secured an extension from banks,” it has been reported. “Anywhere from two weeks to a month, it’s unclear.” That means that of millions the firm is due to pay back this week will have more wiggle room, giving the firm a chance to avoid bankruptcy. As reported by the New York Times:
Dewey is struggling under the weight of a heavy debt load. The firm is locked in negotiations with its banks to restructure its debt. In addition to a $100 million credit line with the banks, it also has a $125 million bond issue, some of which matures next year.
The banks — JPMorgan Chase, Citigroup, Bank of America and HSBC — have given the firm until Monday to come up with a reorganization plan. That deadline, already extended once, could be further delayed, according to people in the discussions.
Dewey themselves have sent memos urging partners to keep the faith and not panic with all the wars and rumors of war from the media.
We are writing to let everyone know that they should not be alarmed by recent press speculation about any imminent plan for any type of filing. The firm remains in business, continues to serve its clients with the highest level of quality and has made no decision to go in any different direction.
(Full memo is reprinted at the end of this article).
The with a bit of hope, which is like an outstretched hand to the drowning Dewey, the agency might gain the time to secure the success of their firm.
======================
DEWEY & LEBOEUF — MEMORANDUM — UPDATE ON THE FIRM’S SITUATION
TO: Global Personnel
First, we want to express our appreciation to all of the staff and lawyers who have made this firm great and who continue to support the firm. We know how stressful the current uncertainty can be for everyone involved. We are continuing to do everything we can to help the firm continue with the great work that we are still doing every day.
We are writing to let everyone know that they should not be alarmed by recent press speculation about any imminent plan for any type of filing. The firm remains in business, continues to serve its clients with the highest level of quality and has made no decision to go in any different direction.
As you have undoubtedly read, we are exploring possible transactions with other firms and other alternatives for moving forward. We will continue to do so and will let people know if anything definitive is agreed to. For now, please continue to do all of our work as you always have as that is the best thing we can all do to help the firm at this difficult time.
Martin [Bienenstock], Steve [Davis], Jeff [Kessler], Charley [Landgraf], and Rich [Shutran]
The Office of the Chairman