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Paris court dismisses 33 claims against Eurotunnel
Page 18
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The restructuring of troubled Eurotunnel came a step closer last week
with a court ruling in its favour. David Harris reports.
EUROTUNNEL HAS taken two major steps towards the financial re-structuring that is designed to save it from bankruptcy.
The Paris Commercial Court dismissed 33 separate claims against the company over the restructuring last week.This led to two creditors who had been pursuing substantial claims against the Channel 'flannel operator to drop their cases.
The end result is a plan under which creditors agree to write off more than £2bn of the company's £6.2bn debt while shareholders have their shares transferred to a new company, but at a substantial face-value loss.
In effect shareholders will be asked to swap 100% of their shares in Eurotunnel as it is now for 13% of the shares in the new company, Groupe Eurotunnel.
Creditors will be able to redeem much of their remaining debt in shares over the next three years, although the company has the option to pay back some of the debt in cash from any income it makes. This would increase the percentage of the company owned by the old shareholders.
The deal now depends on 60% of shareholders accepting the scheme; the company is asking them to do this rather than let it go into liquidation.
There are 500.000 French and 150,000 UK Eurotunnel shareholders — the amount of shares they own is roughly three to one in favour of the French.