FTX global assets review begins, new CEO ‘pleased’ some entities have ‘solvent balance sheets’

November 19, 2022, 3:29 PM UTC
Former FTX CEO Sam Bankman-Fried.
Jabin Botsford—The Washington Post via Getty Images

FTX Trading Ltd. and about 100 affiliated companies are starting a strategic review of global assets as a part of the Chapter 11 bankruptcy process for the collapsed crypto exchange.

“Based on our review over the past week, we are pleased to learn that many regulated or licensed subsidiaries of FTX, within and outside of the US, have solvent balance sheets, responsible management and valuable franchises,” FTX Group’s new Chief Executive Officer John J. Ray III said in a statement.

Among those with the largest identified financial positions are FTX EU Ltd., at $49.4 million in total cash available, and West Realm Shires Services Inc. — which encompasses the FTX.US crypto exchange as well as some acquisitions — at $48.1 million, a filing in Delaware on Saturday showed. FTX Ventures, which launched a $2 billion fund in January, had less than $800,000 in available cash, it said.

The positions were calculated based on verifiable available books and records for the businesses, FTX said in the filing. More than half of identified bank accounts have yet to have their balances verified and other accounts may exist, given the group’s “historical cash management failures and the deficiency of documentation controls.”

The FTX companies, known as FTX Debtors, have engaged Perella Weinberg Partners LP as lead investment bank and started preparing some assets for sale or reorganization, according to the statement.

“I have instructed the team at the FTX Debtors to prioritize the preservation of franchise value as best we can in these difficult circumstances,” Ray said.

The FTX Debtors have filed various motions with the Bankruptcy Court “seeking interim relief from the Court that, if granted, would allow the operation of a new global cash management system and the ordinary course payment critical vendors and vendors at foreign subsidiaries,” it said. A hearing has been scheduled for Nov. 22.

A specific timetable for finishing the process has not been set, it said.

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