September 25, 2019 / 5:08 PM / 21 days ago

UPDATE 1-Casino parent Rallye met with bankers on safeguard plan

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PARIS, Sept 25 (Reuters) - Debt-burdened Rallye said that it and other shareholders of French retailer Casino had met with bankers on Wednesday to present them the principles of their draft safeguard plan.

Casino Chairman and CEO Jean-Charles Naouri in May had placed the retailer’s parent companies Rallye, Finatis and Fonciere Euris under protection from creditors in a bid to save the group from collapse.

Rallye, Fonciere Euris, Finatis and Euris said in a statement the draft plan - drawn up with the assistance of judicial administrators - involved the repayment over a ten-year period of all liabilities.

It also called for a repayment schedule providing for a minimum of 5% of each debt covered by the plan from the third to the ninth year of the plan and for a maximum of 65% in the tenth year of the plan.

The plan also calls for individual consultation of creditors.

In case of refusal of certain creditors, the commercial court may impose extended payment terms, subject to complying with the minimum legal repayment terms as from the third year of the plan, the statement said.

Rallye, Fonciere Euris, Finatis and Euris also asked to extend for six months the observation period with creditors with the view to get the plan cleared by the court at the end of the first quarter 2020 at the latest.

Casino’s net debt stood at 2.71 billion euros at the end of 2018, and Rallye’s stood at 2.90 billion euros.

Casino has been struggling in France, where a price war among supermarkets has dented retailers’ profit margins.

While Casino itself was not placed under bankruptcy protection, it was hit with downgrades that left its credit rating deeper in junk territory, with rating agencies Moody’s and S&P citing concerns over debts at Casino’s parent companies.

Reporting by Dominique Vidalon Editing by GV De Clercq

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