Slater & Gordon's moment of truth is fast approaching.
The embattled law-firm's lenders will gather on Wednesday in Melbourne for a presentation by the company. The meeting comes just two days before Slaters is due to present a credible capitalisation plan, under a timetable agreed by both sides.
Sources say the lenders are expecting a debt-for-equity swap, as foreshadowed by the Australian Financial Review, and to be asked to take a big haircut.
Slater & Gordon is scheduled to report its first half of 2017 financial results in the final week of February and, if the past is any guide, they're not expected to be pretty.
Street Talk revealed that the law firm is now being advised by Moelis & Co as it talks terms with its lenders ahead of May when $480 million is due.
A further $360 million is due in the following 12 months.
But it must present a credible recapitalisation plan this week which would most likely require lenders to haircut their loans. Some distressed debt funds had pinned the value of the law-firm's debt at around 60¢ to 70¢ in the dollar.
