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Italy's CIR hopes to reach deal on Sorgenia debt stand-still soon
February 17, 2014 / 8:42 PM / 4 years ago

Italy's CIR hopes to reach deal on Sorgenia debt stand-still soon

MILAN, Feb 17 (Reuters) - Italian holding company CIR said on Monday it hoped to reach an agreement soon with lender banks regarding a freeze on debt payments at its loss-making energy unit Sorgenia.

In December Sorgenia asked for a six-month freeze on such payments as it sought to address a lack of growth and high indebtedness.

CIR, controlled by the Italian De Benedetti family, said in a statement it was talking with Sorgenia’s creditor banks to reduce the unit’s debt by around 600 million euros ($822 million).

At the end of January, Sorgenia’s gross financial debt was 1.863 billion euros, with a further 304 million euros in the form of guarantees.

CIR said in recent months banks had frozen, suspended and revoked credit lines at Sorgenia.

“If the credit lines are not renewed... Sorgenia could have financial autonomy of around one month,” CIR said.

Sorgenia, 46 percent owned by Austrian utility Verbund , has already presented a new business plan to creditor banks to help start the debt restructuring process. ($1 = 0.7298 euros) (Reporting by Stephen Jewkes; editing by Steve Scherer)

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