Pescanova Lenders Said to Oppose Debt Restructuring Proposal

Lenders to Pescanova SA, the Spanish fishing company trying to avoid liquidation, won’t back a restructuring plan proposed by shareholders.

Creditors will seek to seize control of Pescanova after an April 15 deadline set by a bankruptcy court for the plans from shareholders Damm SA, the Spanish brewer, and Luxempart SA, according to two people familiar with the matter, who asked not to be identified because they’re not authorized to speak about it. The banks plan to find an industrial partner to manage the company, the people said.

The operator of fish farms and processing plants from Spain to Chile, as well as more than 90 ships, needs to win agreement from more than 50 percent of creditors by April 15 to carry out the restructuring plan. Pescanova offered creditors a larger equity stake in exchange for additional capital under a modified restructuring proposal published March 19.

Auditors found Pontevedra, Galicia-based Pescanova had more than 2 billion euros ($2.8 billion) of previously undisclosed debt after it filed for creditor protection in April, prompting a fraud investigation.

Pescanova had 3.25 billion euros of net debt at the end of 2012, according to a Dec. 10 statement from court-appointed administrator Deloitte LLP. First-half results from 2012 reported financial debt was 968 million euros at the end of June.

The seven banks that comprise the steering committee of lenders are Banco Bilbao Vizcaya Argentaria SA, Banco Popular Espanol SA, Banco Sabadell SA, Bankia SA, CaixaBank SA, NCG Banco SA and Unione di Banche Italiane SCPA, the people said. The lenders planned to meet today to discuss the company’s future, they said.

A Pescanova official, who asked not to be identified citing company policy, declined to comment on the restructuring.

“We consider that the proposal Pescanova has presented is the best for the company given that it’s focused on securing its viability and doesn’t leave the company with an unsustainable debt load,” Damm said in an e-mailed statement. “The accord is fair for all parties involved.”

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