Shares Of Carvana Halted To The Upside: What's Going On?

Shares of Carvana Co CVNA are experiencing upside volatility Friday, following a report suggesting lenders do not expect the company to file for bankruptcy soon.

The stock was trading 13.1% higher at $5.61 late Friday morning after it resumed trading following a circuit breaker halt. 

Carvana investors are concerned about being "pushed aside" in a restructuring, according to a Friday Wall Street Journal report. 

This comes two days after the stock fell on reports that the firm's key creditors had teamed to negotiate with the online used vehicle dealer, indicating they were ready for the company to go bankrupt.

Some of Carvana's largest creditors, including Apollo Global Management Inc. and Pacific Investment Management Co., signed a pact Wednesday that binds them to act collaboratively in negotiations with the company, in an effort to avoid creditor fights that have complicated other debt restructurings, according to Bloomberg. 

The group's goal is to present an unified front in discussions for Carvana's new funding or debt restructuring.

The business's bonds have been trading for less than 50 cents on the dollar, indicating that investors fear the company is likely to fail.

Bonds owned by the group will trade separately from those held by non-participating creditors, and any new buyers will be bound by the conditions of the cooperation agreement, according to Bloomberg.

Photo via Shutterstock.