Ambac Financial Group (ABK) missed an interest payment on its debt Monday as it scrambled to raise additional capital. The company indicated that it may file for a Chapter 11 bankruptcy if plans for a pre-planned restructuring with its creditors falls through, according to the company's Securities and Exchange Commission filing Monday.
Ambac, which said in August that it was working with its creditors for a pre-planned bankruptcy, missed the Nov. 1 interest payment on its 7.5% debentures due May 1, 2023. If it doesn't pay up within the next 30 days, it would go into default and its bond holders could call for full payment on its $1.62 million in outstanding debt.
The company, which faces another interest payment on Nov. 15, noted that if it doesn't reach a pre-planned bankruptcy with its debt holders, it plans to file for a Chapter 11 bankruptcy before the end of the year.
Ambac shares were down over 40% in early-morning trading Monday.