BearingPoint struggles to cope with large debt

BearingPoint Inc. will face a day of reckoning on April 15 when lenders who gave the company $200 million nearly three years ago can either convert the debt the company owes them into stock or be paid back the entire principal, reports the Washington Post.

This is the latest chapter in the McLean, Va., consulting company’s continuing struggle to put its finances in order. As the company’s stock plummeted as a result, BearingPoint was suspended from trading on the New York Stock Exchange. While the company has not been delisted, it has has been cut off from coverage by the Wall Street analysts who once followed the firm.

Despite those problems, BearingPoint has reported record client bookings in its public sector business, and the division has retained all of its top 50 clients. The company has retained the restructuring firm AlixPartners to help come up with an operating plan for this year.

If the company is forced to pay off its $200 million debt, then it will have several remaining options to retain enough cash to continue to operate. It might sells off assets to raise cash quickly, sell the company, or renegotiate the debt or exchange it for equity.