Banks considering to put Eniro bankrupt – Swedish Dagbladet

Banks considering to put Eniro bankrupt – Swedish Dagbladet

The suspected accounting fiddling in Eniro hit like a bombshell in early September, after the Enterprise’s Svenska Dagbladet published a number of articles that received a surprised Board to launch an investigation. It has led to the sacked CEO, Johan Lindgren, now the police. In connection with the problems that came to light was forced Eniro lower their profit forecasts for the full year. Eniro’s financial problems have been the company’s lenders to greatly inconvenienced.

– Banks are discussing now in terms of where to put Eniro bankrupt themselves to take over the collateral (assets editor’s note). The alternative to this is a new issue of 1-2 billion, says a source familiar with the negotiations.

To discuss banks such a drastic solution to take over the assets to Eniro able to cover the loan of 2.2 billion that the company owed to lenders is unusual. Banks discusses option because of Eniro previously issued so-called preference shares. It costs Eniro 48 million per year to pay dividends, money that the banks would rather see that Eniro now use to amortize their loans. But if Eniro does not pay dividends to preference shareholders so paid a very high interest rate of 20 percent on the withheld dividend.

Banks’ dilemma is that if the Board held by Lars-Johan Jarnheimer chair instead asks shareholders for new money so teaches the interest be cool.

– For the ordinary shareholder’s no upside. It is the preference shareholders and the banks that will primarily take the money from a new issue, said another person familiar with the Eniro.

There is a large group of banks who lent money, including Swedbank, SEB, Handelsbanken and Nordea. It is above all a pair of the Swedish banks that operates on the matter to put Eniro in bankruptcy to take over the assets. Banks would therefore lenders jump the queue of creditors and preference shareholders leave without money. Lenders for now daily discussions among themselves and with Eniro to find a solution, experiences Svd Enterprise.

To Eniro’s financial situation is now urgent is not just about the suspected accounting fiddling, where total SEK 86 million will have been incorrectly reported and which Eniro went out and adjusted on 5 September.

Although the cash flow in the year was positively affected by a variety of items that do not come from the underlying business, goes Eniro business worse than what the company has reported. It shows SvD Enterprise’s earlier review. Eniro argue, however, that the company’s cash flow improved in 2014, but the improvement was primarily due to lower tax and interest payments in 2014 compared to the same period last year.

Eniro’s poor performance means likely that the company is already violating its loan agreements. But according to data SvD Business Eniro has been known as a waiver, respite, from the banks’ loan conditions in September. This means that as long as the banks are negotiating with Eniro so banks are not taking any action against Eniro. Breaking the terms of the loan may mean tougher requirements on higher interest rates and higher mortgage payments for Eniro than before. On 24 October, Eniro’s interim report for the first nine months.