UBS Group AG (SIX:UBSG)'s Credit Suisse is divesting a €100 million ($106 million) credit line to Casino Guichard-Perrachon as part of its ongoing debt-to-equity restructuring efforts. The restructuring, led by Daniel Kretinsky, involves the conversion of €3.5 billion unsecured and €1.3 billion secured debt into equity.
The process also includes the reinstatement of €770 million from Casino's €2.051 billion revolving credit facility. This move comes ahead of an Oct. 25 deadline for lock-up agreements, following which Casino will initiate an accelerated safeguard process.
The safeguard process enables plan approval with support from secured creditors, even in the face of opposition from dissenting creditors. This strategic approach will allow secured creditors to gain control of at least 28.4% of the shares in the French grocer during its ongoing restructuring phase.
The aim of this debt-to-equity conversion and additional capital increase is to bolster Casino's financial stability and position it for future growth opportunities. The support from secured creditors, as evidenced by their potential share control, demonstrates a strong vote of confidence in the company's restructuring strategy and its future prospects.
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