* UniCredit CEO sees no further problems for Sorgenia debt
* Sorgenia restructuring deal expected by Wednesday -
* Sorgenia CEO will be kept on after shake-up - source
(Recasts lead, adds sources, details)
By Giancarlo Navach and Stephen Jewkes
MILAN, July 22 Italy's Sorgenia, controlled by
holding company CIR and Austria's Verbund,
is close to reaching a deal that will restructure debt and hand
control of the energy group to creditor banks, a lender and
sources said on Tuesday.
Loss-making Sorgenia - 53 percent owned by CIR, which is in
turn controlled by Italy's De Benedetti family - invested
heavily in gas-fired power plants that proved expensive to run
when the economic downturn hit demand and prices.
It has run up 1.85 billion euros ($2.6 billion) of debt and
is presently in talks with creditor banks to restructure its
debt pile and agree a share issue of 400 million euros.
Sorgenia owes money to about 20 Italian and foreign banks
including UniCredit, Banca Monte dei Paschi di Siena
and Italy's biggest retail lender Intesa Sanpaolo.
As part of the debt restructuring, the firm is seeking to
extend a freeze obtained earlier this year on repayments.
"I don't know if we have materially signed already but we
are very close. I don't expect any further problems on the debt
standstill agreement," UniCredit Chief Executive Federico
Ghizzoni said on the sidelines of an event in Milan.
A source close to the matter said a debt standstill accord
between Sorgenia and the lenders was imminent, as well as a
broader framework deal between banks and Sorgenia shareholders.
"It's a complex process because there are a lot of banks
involved and a lot of paperwork. There should be a preliminary
deal today or tomorrow," the source said, adding a final
agreement would take another month or so.
A second source with knowledge of the matter said a
preliminary deal could be signed as early as Tuesday.
The sources declined to be named because the matter is
Complex restructuring talks are focusing on a conversion of
debt into equity by the banks that would leave them with around
98 percent of Sorgenia, separate sources have said.
CIR and Verbund - which holds 46 percent of Sorgenia - have
written off the entire value of their investments in the energy
company, the No. 2 electricity supplier for Italian businesses,
Sorgenia, which had revenues of around 2.3 billion euros in
2013, is planning to sell assets to help shore up its balance
One of the sources said Sorgenia's CEO Andrea Mangoni would
be kept on to manage the company after the ownership shake-up.
($1 = 0.7426 Euros)
(Additional reporting by Georgina Prodhan; Editing by Pravin