Tokyo Electric seeks release of collateral on loans totalling $10 bln-sources
TOKYO Dec 11 (Reuters) - The operator of the wrecked Fukushima nuclear plant is asking its banks to release collateral on its loans, sources said on Wednesday, a move that could free the utility to better use its assets while saddling the lenders with greater risk.
Tokyo Electric Power Co. is not specifying the amount of assets it wants banks to surrender claims to, but its collateralised loans total some 1.02 trillion yen ($9.91 billion), the people familiar with the negotiations told Reuters.
The request is part of a refinancing that Tepco -which has lost $27 billion since the nuclear facility was wrecked by earthquake and tsunami in March 2011- is seeking as part of a business-revival plan it is due to announce this month.
A Tepco spokesman declined comment on the plan, while representatives of key creditor Sumitomo Mitsui Financial Group did not immediately respond to a request for comment.
If banks release collateral, Tepco could sell those assets, which it might do if its transmission and other businesses were split up as some have proposed. Tepco could also use the assets as collateral for new loans.
Conversely, the move is risky for the banks since they would no longer have recourse to Tepco's assets in the event of bankruptcy.
It is unclear whether Tepco would be required to pay a higher interest rate on the loans if they were uncollateralised, the sources said. ($1 = 102.8850 Japanese yen) (Reporting by Fuse Taro, Yoshifumi Takemoto,; Kentaro Hamada and Taiga Uranaka; Writing by William Mallard; Editing by Shinichi Saoshiro)
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