Elcoteg (OMX: ELQAV) said after the bell that Elcoteq's RCF lenders have decided to accelerate the outstanding revolving credit facility despite Elcoteq’s pleas for them not to do so in connection with the planned restructuring of the companys debt via a potential deal with Platinum Equity. Elcoteq will apply for controlled management insolvency proceedings to be able to continue operations.
Danske Bank (OMX: DANSKE) gave the notice to Elcoteq and is acting as an agent on behalf of other revolving credit facility lenders RBS, SEB, Nordea, Pohjola, Banco Bilbao Vizcaya Argentaria, UniCredit Bank and HSH Nordbank.
Elcoteq is blaming the company’s lenders harshly saying as follows: “In the Company's view, the lenders' act shows total disregard of the Company's customers, suppliers and close to 7000 employees as well as other stakeholders.”. While it can be argued that it might not have been in the best interests of the lender in question to do so, lenders have every right to do just that when company does not meet its obligations.
In a bizarre twist, investors drove up Elcoteq's stock price after the Platinum Equity announcement, which contained the notice that Elcoteq is unable to repay the remaining 48.5 million Euro on its revolving credit facility. Now investors will in all likelihood feel pain stemming from that decision.
No comments:
Post a Comment