Ebix Inc. Files for Chapter 11 Bankruptcy in Northern Texas, Facing Financial Struggles

In a recent court filing, Ebix Inc. has initiated Chapter 11 bankruptcy proceedings in Northern Texas, as reported by Bloomberg. The financial statement accompanying the filing reveals estimated liabilities ranging between $500 million and $1 billion, with corresponding assets falling within the same range.

This development transpires just one month after Ebix failed to meet a deadline for repaying a substantial $617 million loan. The company had already been declared in default by creditors in September, citing prior repayment delays.

Creditors, in response to the company's financial woes, had been pressuring CEO Robin Raina's firm to liquidate assets to mitigate losses.

Last year, Hindenburg Research had cast a critical light on Ebix, particularly targeting its EbixCash unit, a money-transfer business, describing it as a "house of cards."

Although a spokesperson for Ebix declined to comment on the recent filing, the company had previously refuted Hindenburg's allegations, deeming them "grossly misleading and erroneous." Ebix asserted that accountants from Alix Partners had thoroughly reviewed concerns related to the unit's gift card business, and the company's board was confident that no corrective measures were necessary, as per Bloomberg's report.

Furthermore, Ebix emphasized the accuracy of its books and records, asserting compliance with accounting standards and U.S. Securities and Exchange Commission reporting requirements.

It is worth noting that Ebix had secured a temporary restraining order last year against Hindenburg, Google, and Twitter, preventing the republication of the critical report in India.

(Information sourced from Bloomberg)