A-Tec Industries AG’s AE&E construction unit received court clearance to reorganize debt after it failed to sell the company or unfreeze a 798 million- euro ($1.06 billion) credit line.
AE&E will be managed by an administrator after it filed for reorganization proceedings at the Vienna Commercial Court today, the company said in a statement. Under the restructuring, which is part of the insolvency process, creditors are being offered 20 percent of what they are owed, AE&E said.
A-Tec requested a self-administered debt restructuring on Oct. 20 that didn’t affect its four units, of which AE&E is the biggest. AE&E, which builds power plants for utilities and steel makers, had 1.8 billion euros of revenue and pretax profit of 73.7 million euros in 2009, according to A-Tec’s annual report.
Talks between AE&E and banks including BNP Paribas SA, Commerzbank AG, Erste Group Bank AG and Raiffeisen Bank International AG, over 97 million euros in bridge financing collapsed on Nov. 15. The banks had suspended a 798 million-euro credit line in mid-October.
AE&E had been trying to sell itself and potential buyers included Austria’s Andritz AG, Mass Financial Corp. of Hong Kong and Korea’s Doosan Heavy Industries and Construction Co., A-Tec said in a separate statement today.
A-Tec will adapt its restructuring plan to account for AE&E’s filing, A-Tec said. Its Chief Executive Officer and majority shareholder Mirko Kovats is offering A-Tec creditors a 25.1 percent stake in the company, the company said.
A-Tec fell 18 percent to 2.01 euros at the 5:30 p.m. close of trading in Vienna. Shares have declined 77 percent this year, valuing A-Tec at 53 million euros.
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