BRE Bank announces three-step plan to rescue Elektrim

BRE Bank, a key investor in energy and telecom conglomerate Elektrim might be on the right track to save the giant from bankruptcy, but the price will be the dismissal of current managers and break up of the once leading firm. The bank announced a three-step plan in which it hopes to persuade bondholders not to press for bankruptcy, reshuffle the board and then sell Elektrim's assets to finance debt repayment. According to analysts, BRE Bank together with allies owning a 20% stake in the bankruptcy-threatened company have the capability to change the minds of creditors who filed to bankrupt it over a euro 480 million bond default. BRE has already proved it knows how to restructure firms by leading a similar operation in 2000 to restructure troubled computer firm Optimus, selling out with high profit. "It looks like they can do it," said Raimondo Eggink, a Dutch equity analyst who has followed Poland for 12 years. "Elektrim should be taken apart; the only question is who will do it. But whoever does it will make a lot of money." Jacek Radziwilski, an analyst at Deutsche Bank in Warsaw added, "If Elektrim reaches an agreement on debt settlement with bondholders, it will have a chance of operating as a power group in a year or two." (Reuters) A.K.