LONDON May 14 Five groups of lenders have
submitted proposals to restructure struggling French retailer
Vivarte's 2.8 billion euro ($3.85 billion) debt, the company
announced on Wednesday.
Alcentra, Hayfin and Credit Suisse Asset Management have
formed a group and submitted a restructuring proposal as did
Angelo Gordon & Co with Avenue Capital Group and Sankaty
Advisors. GoldenTree, ICG , Oaktree, Canyon, Babson and Oak Hill
grouped together to submitted a proposal.
Elliot Advisor and Park Square submitted proposals on a
Vivarte's management will now discuss the different options
with a 'Conciliateur' and decide which offer to go with by the
end of June.
Private equity firm Charterhouse bought Vivarte in 2007,
backed by 3.43 billion euros of leveraged loans, but has
struggled to manage its debt in an unfavourable economic and
consumer environment in France.
Vivarte needs a large portion of existing debt wiped out in
return for equity, as well as an injection of fresh cash in a
move that is expected to see Charterhouse walk away from its
investment, banking sources said.
Vivarte entered into a four-month conciliation process with
its lenders in March to negotiate a way forward after failing to
get an agreement from a majority of its lenders to suspend loan
covenant tests. A number of lenders submitted letters of intent
on how to restructure Vivarte's debt last month and more formal
offers were submitted last Friday
Vivarte is looking to reduce debt to a maximum of 1 billion
euros. Proposals centre around the injection of 500 million
euros of new cash either in the form of super senior loans or
convertible bonds and writing off up to 2.3 billion euros of
existing first lien and second lien debt, in return for equity,
the banking sources said previously.
(Editing by Christopher Mangham)