In a significant development in the technology and financial services sector, Ebix Inc., led by Indian-American entrepreneur Robin Raina, has filed for bankruptcy protection in a North Texas court. The decision follows the company’s default on a substantial $617 million loan, marking a challenging period for the Atlanta-headquartered firm.
According to a recent Bloomberg report, several subsidiaries of Ebix have also initiated bankruptcy filings. The legal firm Sidney Austin LLP has been appointed as the bankruptcy counsel, while Jefferies LLC will play a crucial role as the investment banker overseeing the proceedings.
Last month, Ebix Inc. reported its operating income for Q3 2023, amounting to $20.5 million. This reflected a notable decline of 32.4% compared to the Q3 2022 figure of $30.4 million. The decrease was attributed to factors such as specific IPO marketing costs and restructuring-related expenditures. Over the nine-month period ending Q3 2023, Ebix’s operating income of $80.1 million represented an 11.5% drop from $90.6 million in the corresponding period of 2022.
Ebix’s financial struggles were evident in its annual report filed in December 2021, revealing outstanding debt obligations totaling $656.0 million, excluding deferred financing costs. This included a $212.9 million term loan, a $439.4 million balance on its revolving line of credit, a $1.8 million note to IHC by the EbixHealth JV, and a $2.0 million short-term debt financing for its large corporate insurance requirements.
As the bankruptcy proceedings unfold, the fate of Ebix Inc. and its subsidiaries hangs in the balance, with stakeholders closely monitoring the developments in the case.
