PARIS, July 5 Troubled France-Corsica ferry
operator SNCM needs to go under court protection to shield
itself from a European Commission order to repay 440 million
euros ($600.2 million) in state aid, France's transport minister
was quoted saying.
Frederic Cuvillier told French daily La Provence that the
loss-making firm, whose unions have been on strike since June
24, cannot continue its activities in its current form without
risking bankruptcy and needs an ordered restructuring.
"The situation described by the company's management leads
us to think that for this restructuring the company needs to go
under court protection," Cuvillier was quoted as saying.
Cuvillier said he had confirmed this in a letter to the
unions and that this was the only way to give a future to SNCM.
It is the first time a French government minister has raised
this possibility, which the unions oppose because they fear it
will lead to job losses and less favourable labour terms.
Owned 66 percent by Transdev - a public transport joint
venture between water and waste group Veolia Environnement
and state-bank CDC - the ferry operator has racked up
cumulative losses of 250 million euros over the past decade
despite subsidies it receives from French authorities.
Some legal experts say a Chapter 11-style restructuring
would allow a new owner to buy some of SNCM's ships and continue
some of its current routes under a new legal structure and with
part of the company's staff.
SNCM's restructuring is crucial for Veolia as the current
stalemate blocks a plan to sell most of its stake in Transdev -
a tram, train and bus operator with turnover of 7 billion euros
and 90,000 staff in more than 20 countries - to CDC.
($1 = 0.7331 Euros)
(Reporting by Geert De Clercq; Editing by David Holmes)