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Casino parent Rallye extends observation period with creditors

PARIS (Reuters) - Debt-burdened Rallye and other shareholders of French retailer Casino agreed with bankers to extend by six months an observation period of proceedings with creditors and confirmed their objective to have a draft rescue plan cleared by early 2020, Rallye said on Monday.

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

In September Rallye, Fonciere Euris, Finatis and Euris had said that the draft rescue plan, drawn up with the assistance of judicial administrators, involved repayment over a 10-year period of all liabilities.

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.

Earlier this month, Casino completed a 3.8 billion refinancing package.

Reporting by Dominique Vidalon, Writing by Benoit Van Overstraeten; Editing by Grant McCool