Deal with bondholders saves Netia from bankruptcy

Ailing telecoms company Netia announced yesterday it had agreed a debt-for-equity swap with its bondholders. The deal, which saves the company from almost certain bankruptcy, assures the creditors of receiving newly issued shares, which will amount to 91% of total Netia capital after restructuring. As a guarantee for the new share issue, a Dutch-based Netia unit will issue ?50 million worth of bonds. "The restructuring will allow us to build a solid capital structure, and gives us the basis for growth in the future," explained Netia's acting chief executive, Kjell-Ove Blom. "We are anxious that the company will not have to borrow any extra money. We want to be self-sufficient," he went on. Yesterday's shareholders meeting decided to issue around 350 million new shares, and not the 600 million widely anticipated beforehand. Reaction to the announcement was generally positive. The Netia share price on the Warsaw Stock Exchange (WSE) rose 25.7% from Monday's close, to end the day at zl.4.30. Further agreements are expected at the next Netia shareholders meeting, which has been scheduled for March 12. (Puls Biznesu, p. 8; Prawo i Gospodarka, p. 5; Reuters) A.K.