(Bloomberg) — BGC Companions Advisory, a boutique restructuring agency began in 2024 by ex-Citigroup Inc. public finance bankers, is dissolving.
Puerto Rico’s monetary oversight board, which manages the island’s spending and the bankruptcies of its authorities companies, was a key consumer for BGC and obtained a discover from the agency of its plans to dissolve. An individual with direct data of the matter who requested to not be named discussing the state of affairs confirmed BGC’s dissolution.
“BGC has knowledgeable the oversight board that it intends to dissolve its partnership, and the oversight board will talk its resolution concerning its monetary advisor going ahead on the applicable time,” Matthias Rieker, a board spokesperson, mentioned in an e mail. “The oversight board doesn’t count on that BGC’s resolution may have any influence on the Prepa debt restructuring,” Rieker mentioned, referring to Puerto Rico’s Electrical Energy Authority.
David Brownstein, the previous head of Citi’s now defunct public finance division who labored on the largest bankruptcies within the municipal market, and former Citi colleagues John Gavin and James Castiglioni fashioned BGC in January 2024. BGC didn’t present a touch upon the matter.
BGC’s disbanding comes after its most up-to-date contract with the monetary oversight board ended on June 30, in response to the most recent engagement letter between the agency and the board. BGC in September submitted to Puerto Rico’s chapter courtroom its remaining software for compensation that lined charges and bills via the top of that month, in response to the courtroom submitting.
Prepa, the island’s government-owned energy utility, has been in chapter since 2017. Bondholders and the oversight board have but to achieve an settlement on easy methods to scale back almost $9 billion of excellent debt. The chapter’s progress stalled final yr because the courtroom is searching for to resolve a dispute between bondholders and the board concerning Prepa’s revenues earlier than debating any restructuring proposal. That shift drastically diminished BGC’s workload.
BGC confronted criticism on social media in August when far-right activist Laura Loomer highlighted the group’s $850,000 month-to-month retainer. The Trump administration fired a lot of the board’s members at the moment, citing the island’s extended bankruptcies. But the panel’s exercises have slashed $55 billion in creditor funds over 40 years. Three members sued to be reinstated and a decide in October dominated they might proceed their work on the board whereas the case continues.
Castiglioni, a former head of economic structuring at Citi, joined Huntington Nationwide Financial institution as a managing director in its New York Metropolis workplace on Monday, in response to Samantha Costanzo, the financial institution’s head of public finance.
Castiglioni labored at Citi for almost 14 years, together with 5 years as a director the place he helped execute greater than 50 municipal debt transactions totaling a mixed $50 billion, in response to his LinkedIn web page.
At Huntington, Castiglioni shall be a senior banker overlaying shoppers all through the US and supply monetary modeling experience to the crew, in response to Costanzo.
“James brings vital expertise working with among the largest and most complicated issuers within the U.S. and can assist us proceed to deepen and broaden our consumer protection,” Costanzo mentioned in an e mail.
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