VIENNA May 7 Austrian utility Verbund
, which holds a large stake in energy group Sorgenia,
said the firm's Italian majority owner and creditor banks must
find a solution to its debt problems.
Italy's Sorgenia, 52 percent owned by Italian holding
company CIR, ran up 1.8 billion euros ($2.5 billion)
of debt by investing heavily in gas-fired power plants that
proved expensive to run when the economic downturn hit demand
CIR and Verbund, which has a 46 percent stake, are meeting
the energy group's creditor banks on Wednesday to discuss a
restructuring of 600 million euros of debt that must be cleared
in the short term to keep the company afloat.
Loss-making Sorgenia owes money to about 20 Italian and
foreign banks that have proposed a deal to convert 400 million
euros worth of debt into equity. Another 200 million euros would
be refinanced through a mandatory convertible bond the banks
Verbund confirmed it was taking part in the talks but has
said on several occasions it is not prepared to inject more
money into Sorgenia.
"We support an Italian solution," a spokeswoman said,
Verbund has offered to sell its stake, which it has already
written off in its own books, as its contribution to the rescue.
The spokeswoman declined to comment on what interest, if any,
the company's offer had attracted.
CIR, owned by business family De Benedetti, has previously
said it is not ready to increase its stake in Sorgenia.
A source close to the matter told Reuters last month the
banks had made any debt-to-equity swap deal conditional on
Sorgenia shareholders backing it unanimously.
Sorgenia's main creditor is bailed-out Italian lender Banca
Monte dei Paschi di Siena. Others include Intesa
Sanpaolo, UniCredit and Mediobanca.
($1 = 0.7177 euros)
(Reporting by Alexandra Schwarz-Goerlich; Writing by Georgina
Prodhan; Editing by Pravin Char)