First Brands’ Business Flails as Customers Don’t Know Who to Pay

As First Brands Group makes its way through bankruptcy court, the auto-parts supplier is bumping up against an unexpected snafu: Its customers don’t seem to know who to pay.

As the extent of First Brands’ opaque web of debt spilled into plain sight, investors who snapped up its receivables via so-called factoring deals — fearing a wipeout from allegedly fraudulent invoices — directed companies that sell its fuel pumps and wiper blades to pay them directly, rather than going through a First Brands account where they were historically made. That created “significant confusion,” according to restructuring advisory firm Alvarez & ...