Ambac misses interest payment, may file Chapter 11 by year end
Ambac Financial Group (ABK) missed an interest payment and may file for Chapter 11 bankruptcy by the end of the year. The bond insurer has $1.62 billion in debt and another interest payment due Nov. 15, according to an 8-K filing with the Securities and Exchange Commission. Ambac's board elected not to make the payment on debt due May 1, 2023, and will be in default of the agreement if no interest is paid within 30 days, which would allow noteholders to call the debt. "The company has been unable to raise additional capital as an alternative to seeking bankruptcy protection. As such, the company is currently pursuing with an ad hoc committee of senior debt holders a restructuring of its outstanding debt through a prepackaged bankruptcy proceeding," Ambac said in the filing. Shares of the New York-based company tumbled to less than 50 cents a share early Monday, according to MarketWatch. In August, Ambac said it was "highly unlikely" its main business unit, Ambac Assurance Corp., would be able to make dividend payments to the parent company. Then later that month, a group of investors sued Ambac to stop any such payments anyway. Write to Jason Philyaw.