UPDATE 2-Thomson SA seeks to reassure holders on debt talks

* Discussed conversion terms, debt rescheduling, governance

* Shareholders approve all resolutions

* CFO eyes final offers on Grass Valley by end-week

* Stock closes nearly 8 percent down (Recasts top paragraphs, adds quotes, shareholders OK resolutions, background)

By Dominique Vidalon

PARIS, June 16 (Reuters) - French media technology company Thomson SA (TMS.PA) on Tuesday tried to reassure shareholders that the debt-for-equity restructuring deal it was negotiating with its creditors was in the interest of all involved.

Chairman and Chief Executive Frederic Rose said a deal, if reached, would give him a free hand to put the money-losing company back on a path to profit and investment-grade debt ratings.

"It will allow me to refocus on improving EBITA, work toward repaying the debt and one day resume paying dividends," he said.

Shareholders, who fear the deal could lead to heavy dilution, will also have "the final say" as they will be asked to approve it, he added.

The supplier of set-top boxes, DVDs and video and telecom equipment said on Monday it had won time to seal a balance sheet restructuring deal crucial to its survival and now has waivers until July 24 from creditors owed 2.9 billion euros ($4 billion) [ID:nLR123488].

The waiver was "the first strong and positive signal" for Thomson's clients and suppliers and an indication that "talks were on a right track," Rose said.

Thomson, which had until June 16 to reach an agreement or risk bankruptcy, said its main creditors were now considering a restructuring proposal it had made.

The proposal entails a significant reduction of the group's debt through a conversion of debt into equity, and allowing existing shareholders to take part in the recapitalisation.

Rose did not give further details on the proposal, saying that it had "not yet been formally accepted by our creditors."

However, he said that Thomson had discussed debt conversion terms, governance issues and debt rescheduling with creditors.

Thomson has in the past held informal discussions with France's strategic fund (FSI) and Rose reiterated on Tuesday that the group must first solve its debt problem before the fund or any other individual investor could consider taking a stake.