Abengoa Bonds Drop as It Seeks Support for Debt Restructureby
Abengoa SA’s bonds fell as the renewable-energy provider seeks investor support for a debt-restructuring plan to avert insolvency.
The Spanish company’s 500 million euros ($566 million) of bonds due at the end of March dropped as much as 4 cents on the euro to 14 cents, the lowest since March 7, according to data compiled by Bloomberg.
Abengoa needs backing from holders of 75 percent of its debt to pass a restructuring plan that was agreed in principle with some investors last week. It’s seeking the support of 60 percent of bondholders and bank lenders for a debt standstill by March 28 that will protect the company from creditors and give it time to shore up support for the plan.
“They need to do a lot in very little time,” said Maxime Kogge, an analyst at Spread Research in Lyon, France. “There is uncertainty over whether they will get enough support for the standstill and whether the court will approve it.”
A spokeswoman for Abengoa declined to comment on the bond price.
Centerbridge Partners, Elliott Management Corp. and KKR & Co. LP are among investors that will anchor a new loan facility of as much as 1.8 billion euros, the company said in a conference call Wednesday. The deal will cut debt to 4.9 billion euros from 9.4 billion euros, the conference was told.