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CDK Strikes Restructuring Agreement with Creditors
September 1, 2026
-Vandit P
CDK Global reached a debt restructuring agreement with a group of creditors after its parent, Brookfield Business Partners, agreed to subordinate part of its CDK debt. Under the proposed deal, Brookfield would exchange about $675mn of its existing debt holdings for lower-ranking securities, with interest paid in kind rather than cash, helping CDK preserve liquidity. In exchange, creditors on the steering committee would swap secured debt due in 2029 for new obligations maturing 2.5 years later, while accepting an 8% discount. The arrangement also contains a provision that could allow participating creditors to impose a larger haircut on Brookfield if it continues buying CDK debt in the secondary market before the transaction closes. The additional discount could reach as much as 13%, with the affected debt capped at ~$1.2bn. CDK has struggled with declining earnings and high leverage while dealing with the financial fallout from a major cyberattack in 2024. Moody’s downgraded the company’s credit rating by two notches to Caa2 in early August, citing high leverage, weak revenue and refinancing risks. CDK will now look to negotiate a deal with remaining lenders.
Its 7.25% 2029s traded at 53.1 cents on the dollar
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