(Oct 1): BlackRock Inc is set to become the largest shareholder in SellerX as part of a deal to slash the former unicorn’s debt load, according to people familiar with the matter.
  
BlackRock, an existing lender to the Berlin-based firm, will take a stake in the business as part of a debt-for-equity swap and refinancing, the people said, asking not to be named discussing private information. Existing equity investors will retain a share of the business, they added. 

SellerX said in a statement on Monday that it had reached a deal which would improve liquidity and cut corporate debt, without expanding on the change in shareholders. The brand aggregator — a firm that acquires and scales up online retailers — is backed by equity investors including L Catterton and Sofina.

“We are pleased to have the continued support of our lenders and investors who joined together on the recapitalisation of the business,” SellerX chief executive officer Olivier Van Calster said in the statement.

Representatives for BlackRock and SellerX declined to comment on the ownership shift. Spokespeople for L Catterton and Sofina didn’t immediately respond to a request for comment. 

Brand aggregators, which own a variety of companies which sell products on internet-based shopping platforms such as Amazon, became hugely popular investments during the pandemic boom in online spending. However, rising interest payments on large debt piles and a slowdown in sales growth have seen companies in the sector falter.   

BlackRock was a lender to SellerX, alongside Victory Park, as part of an initial US$400 million (RM1.65 billion) loan facility granted in 2021, which was then upsized after an acquisition. BlackRock moved the loan to non-accrual status — meaning the borrower has stopped making payments — in the second quarter of this year, citing its stressed balance sheet. 

Lenders to SellerX had initiated, and then cancelled, an auction for shares in the company earlier this month. The threat of enforcement processes like auctions can be used by creditors as a bargaining tool in negotiations.

For BlackRock, it’s not the first time that investments in the brand aggregator space have soured. The asset manager was also a lender to Thrasio Holdings, which emerged from Chapter 11 bankruptcy proceedings in June, and to US-based Perch. 

BlackRock put Perch on non-accrual status before it was acquired by Germany-based Razor Group earlier this year, according to a March earnings call. BlackRock was also a lender to Razor. 

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