Eurotunnel will turn the page of overindebtedness

Eurotunnel will turn the page of overindebtedness. Meeting yesterday at the tribunal de commerce, bondholders (82,17 of the holders of duty in euro and 69,22 of those holding bonds denominated in pounds) voted in favour of the proposals for the restructuring of the debt of the concessionaire to the channel tunnel. After the vote on the financial creditors on November 27, the vote allows Eurotunnel to look to the future with more serenity. Nothing is now opposed to what the Court of valid trade a hearing is scheduled Monday 18 December the backup plan for Eurotunnel, which can be implemented in the first quarter of 2007. It's delete purely and simply 54 of the debt, which will be reduced from 9.1 billion to 4.16 billion, and lower finance charges no more than 220 million per year (against 450 million previously), for a turnover of 800 million.

For Jacques Gounon, President and CEO of Eurotunnel, it's a real victory. After nearly two years of discussions, it may welcome have managed to bring together all the creditors on a project that person considers ideal, but which has the merit of having reached a point of balance. As such, the election of yesterday did not of itself. As for bondholders, vote for the plan represented a big sacrifice. Holders to the start of a debt of EUR 2.8 billion, they do meet, at the end of the proposed plan, that approximately 17 of its species and bonds repayable in shares (ORA), while the financial creditors will be fully refunded. But it is true that this restructuring will enable them even refinancing limited their debt while, in the event of liquidation, they would have lost everything. In addition, many have acquired debt at prices declassified from its face value. Even if the restructuring caused them to lose the hope of recovery, one day, the whole of the face value of debt, the real financial effort of the abandonment of debt is sometimes low. Some should even show gains.

Oaktree Fund claim

Now, it remains to Eurotunnel to take the third and final step to mobilize shareholders to the public exchange offer to be launched by the new Eurotunnel group in the first quarter of 2007. Jacques Gounon had indicated late October, on the disclosure of its proposals, if 60 of them brought their titles, IRAP would be successful. The committees of the British and French shareholders supported the plan, but regularly voices denouncing the high dilution that shareholders will suffer. Holding 100 of the new structure initially, their share in the capital could get up to 13. The intention of Jaques Gounon is gradually buy 62 of the ORA distributed to bondholders and holders of the junior debt to limit dilution of shareholders and allow them to keep 67 of the capital.

Only shadow table: Oaktree Fund filed a claim with the tribunal of commerce concerning the Organization of the voting on 27 November, which he says, allowed certain creditors to the plan to vote several times early in the week. And he did not intend to rest there. If the Court does not succeed, he decided to appeal.