Business News

Immediate Short-Term Financing Agreed for Cimos

Koper, 27 May (STA) - Creditor banks, clients and the management of the automotive parts supplier Cimos agreed on Tuesday on an an immediate short-term financing programme that will allow production to be maintained at present levels after debt restructuring was initiated at the company last week.

"All stakeholders will continue with constructive talks on implementing the plan for restructuring and mid-term financing. The goal is to set the foundations for a sustainable salvaging of Cimos," representatives of what is one of the biggest companies in Slovenia wrote in a short press release.

Cimos, based in Koper and employing around 7,000 people at group level, will undergo court-supervised debt restructuring after key creditors decided against a debt-to-equity conversion last week.

Four banks and the Bank Asset Management Company (BAMC), which hold 80% of Cimos liabilities, opted for the move after concluding that none of the company's problems except capital adequacy would be resolved with a debt-to-equity conversion, BAMC officials said.

The original plan, confirmed by the shareholders on 30 April, involved the conversion of between EUR 112m and EUR 186m of debt to equity, which was seen as a key step in the company's financial restructuring.

But the creditors are convinced debt restructuring is better, since it will allow the company to retain customers and preserve jobs. They have already drawn up a plan in cooperation with all stakeholders, according to senior BAMC officials.

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