The stock climbed 4.7 percent to 2.92 euro cents, giving Turin, Italy-based Seat a market value of 56.9 million euros ($75 million). Bondholders proposed Nov. 4 to write down some of their 1.3 billion euros ($1.7 billion) of debt in exchange for a 90 percent stake in Seat Pagine.
“The agreement on the new debt structure is very positive news,” Marco Greco, an analyst at Mediobanca SpA, said in a note today. “However, the most important point --allocation of equity in the company post-restructuring -- is still pending and the time left is only one week. If there is no agreement, then the company is due to become insolvent and would eventually put under bankruptcy procedures.”
Last month, Seat Pagine said it would take advantage of a 30-day grace period to skip a 52 million-euro coupon payment due Oct. 31 on its Lighthouse junior bond. Under the agreement reached yesterday, the coupon will be paid by Nov. 30. The company requested that all parties enter into a “lock-up” agreement to hold their securities.
“This is an extremely challenging timetable,” Seat said in a statement late yesterday. “The company urges all stakeholders to use every effort to ensure” they meet the deadline.