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second Ebix debt extension -3

10:04 24-May-23


Ebix has signed a second debt extension, to September 30th.  The press release is fuzzy and glosses over just how onerous some of the terms are, but  the 8-K has more detail.  As anticipated, this extension forces another $5M debt repayment, and imposes 2% in amendment fees.  It increases the floating rate margins to between 6.5% and 8% for various lines of credit.  It also mandates that substantially all of the proceeds from any capital raise go toward debt repayment, including an EbixCash IPO by July 31st, with repayment within a month of the offering.

EBIX was initially down 5%, but has recovered most of that for the time being.  I doubt traders have really looked into the terms yet.  The CEO can continue prattling on about being debt-free this year, but I still want no part of a company paying double digit interest and expensive fees while hoping to be bailed out by a questionable IPO.