Lenders to Dye & Durham Ltd. have retained Houlihan Lokey Inc. to serve as their financial adviser as scrutiny grows around the software firm's capital position, according to people familiar with the matter.
Those people said creditors held pitches from multiple advisory firms in recent weeks before selecting Houlihan Lokey. The creditor group is also working with law firm Paul Hastings and has formalized a cooperation agreement that, at present, is not admitting additional holders.
Within the cooperation group, Silver Point Capital LP and KKR & Co. are named as members by the individuals familiar with the discussions. The people said first-lien lenders are concentrating their conversations on how to engage with the company rather than negotiating potential new financing proposals.
In addition to the cooperation group, the people said a separate minority lender group could emerge. That prospective minority group is expected to be led by law firms Hogan Lovells and Cadwalader, according to the same sources.
What lenders are asking for remains procedural: they have organized advisory pitches, selected a financial adviser, and formalized counsel arrangements and a cooperation agreement. The advisers and the structure of the cooperation group are intended to coordinate creditor actions and responses as concerns about Dye & Durham's capital position mount.
Dye & Durham provides software solutions to legal and business professionals. The steps by creditors reflect a heightened level of attention from the debt holders, who are evaluating engagement strategies with the company.
Details beyond the advisers named, the makeup of any new minority lender group, and the precise next steps in creditor-company engagement have not been disclosed by the people familiar with the matter.
As the situation develops, lenders have elevated the use of formal advisory and legal resources and have centralized certain members within a cooperation agreement. Whether that coordination leads to negotiated amendments, restructuring, or other outcomes has not been specified by the sources.
The coordinated adviser selection and law firm representation underline creditors' intent to manage their collective position amid the increased focus on Dye & Durham's finances.