Netia working to gain support for debt-for-equity swap

Shareholders in Netia yesterday agreed unanimously to issue up to 317.7 million new shares, to be passed to the company's creditors in a life-saving debt-for-equity swap. The decision in effect means ceding control of Poland's leading independent telecoms operator, since the current shareholders will retain just 9% of shares in the company. Netia chief executive Kjell-Ove Blom said the firm was working to gain support for the debt restructuring from the holders of at least 95% of its $850 million in defaulted bonds. "This process will last until the end of March. Presently we have holders of 53% of the bonds on board," Blom said. But analysts say Netia still faces a struggle for survival in the weak fixed-line telecoms business. "The company has recovered from its dire financial straits... Its indebtedness will decrease. It shouldn't be forgotten, however, that the company's capital will be seriously diluted and, as a result, a single share rating will drop," commented analyst with BDM PKO BP, Radoslaw Solan. (Puls Biznesu, p. 8; Reuters) M.T.