Spain's Colonial agrees to 1 billion euro refinancing plan

MADRID, April 8 Tue Apr 8, 2014 2:57pm EDT

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MADRID, April 8 (Reuters) - Spanish property company Colonial said on Tuesday it had reached an agreement to refinance debt worth 1.04 billion euros ($1.43 billion) as part of a plan to rescue the company hit by the 2008 property market crash.

The company announced the deal following a special shareholders' meeting in Barcelona at which they also approved a capital hike of as much as 266 million euros.

The accords were on top of an already approved capital-raising plan of up to 1 billion euros which includes the injection of cash from new investors in exchange for a stake in the company.

Villar Mir group, owned by the chairman of Spanish builder OHL, will be Colonial's leading shareholder following the capital hike with a stake of up to 30 percent.

The restructuring at the Barcelona-based company marks a tentative comeback for one of the early casualties of Spain's burst property bubble which has left dozens of property companies bankrupt.

Colonial shares closed up 5.6 percent on Tuesday at 1.975 euros per share. ($1 = 0.7249 euros) (Reporting by Jose Elias Rodriguez; Writing by Paul Day; Editing by Susan Fenton)

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