Pescanova Seen Agreeing to $1.4 Billion Restructuring Deal Today

Pescanova SA will agree to a restructuring deal with its biggest shareholders and banks today giving lenders control of the Spanish fishing company, according to a person familiar with the matter.

Banks will retain 1 billion euros ($1.4 billion) of debt and inject 115 million euros of capital under the plan, said the person, who asked not to be identified because the matter is private. 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 presented the proposals.

The offer replaces an earlier plan involving shareholders Damm SA and Luxempart SA that would have given lenders 700 million euros of debt in the restructured company. Pontevedra, Galicia-based Pescanova faces liquidation unless more than 50 percent of lenders agree to a restructuring deal by April 30.

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

Under the new plan, banks will retain 300 million euros of super-senior debt, 400 million euros of senior borrowing and 300 million euros of junior facilities, the person said.

Pescanova’s net debt was 3.25 billion euros at the end of 2012, according to a Dec. 10 statement from court-appointed administrator Deloitte LLP. The company borrowed from more than 100 banks, a list of creditors prepared by Deloitte shows.

Lender Support

The operator of fish farms and processing plants from Spain to Chile, which also has a fleet of more than 90 ships, employs 13,000 people worldwide and 2,000 people in Spain. Founded in 1960, Pescanova developed the world’s first fishing boat equipped with a freezer, allowing the company’s boats to trawl waters around Brazil, Uruguay and Argentina.

Pescanova turned to its lenders after it failed to get their support for the previous plan proposed by its shareholders. The company will be financially viable if it has less than 1 billion euros of debt, Juan Manuel Urgoiti, the company’s chairman said in September.

Pescanova’s 160 million euros of 8.75 percent convertible notes were quoted at 7.6 cents today, prices compiled by Bloomberg show. The bonds traded at 16 cents on March 6.

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