RPT-Metrovacesa eyes loan waiver if bond flops -source

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by Andres Gonzalez

MADRID, Oct 7 (Reuters) - Spain's Metrovacesa (MVC.MC) will have to seek a waiver from creditors by year's end unless it manages to issue a 1.75 billion euro bond to refinance part of its debt, a source familiar with the transaction told Reuters.

"If Metrovacesa does not reinforce its capital by 1.75 billion euros before December, it will have to ask the banks for a waiver," the source said on Wednesday.

Metrovacesa agreed to the previously unpublicised bond clause when it signed a refinancing agreement on 3.2 billion euros of debt in July 2007 with a pool of 40 banks, led by RBS (RBS.L).

But with international credit markets gummed up, a successful debt issue looks increasingly difficult.

"We could issue bonds, we think it is complicated, although over the year we have seen some windows in the market and some property companies have issued bonds," a spokeswoman for the company said.

"We have until the end of the year to meet this commitment".

Metrovacesa, which focuses on office space in Madrid and Barcelona, has amassed total debts of almost 7.14 billion euros up to the end of June.

The firm is quadrupling its sale of assets to 2 billion euros as it struggles to refinance assets bought at the top of Britain's property boom while facing a property crisis at home.

It has until Nov. 27 to pay back a 810 million pound loan from HSBC (HSBA.L) it used to buy the bank's skyscraper headquarters in London, and faces an Oct 31 deadline on a 240 million pound loan on the Walbrook Square project in the City.

(editing by John Stonestreet)