Eurotunnel debts cause friction • The row over how Eurotunnel
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is to re-finance its enormous debts is continuing as departing chairman Sir Alastair Morton fends off attempts by the banks to swap its debts for shares.
Morton, who is to hand over control of Eurotunnel at the end of October, has made no secret of his determination to oppose the debt-for-equity deal proposed by the 200 banks. They want half of Eurotunnel's equity in return for writing off the company's £9bn debts. Morton opposes this because of the impact such a move would have on small investors who would effectively see the value of their investments fall by 50%. One option the French and British Governments have is to extend the length of Eurotunnel's operating licence by another 30 years which would increase the value of shares and compensate for any share devaluation.