GERMANY - PAI to inject EUR 135m into Monier

Earlier this month lenders rejected PAI's initial proposal, which would have seen them slash the company's debt by around two-thirds in return for a 24% equity stake while PAI invested EUR 125m to retain majority control, saying that it did not offer sufficient value.

This was followed by the news that a consortium of distressed debt investors comprising Apollo Management, TowerBrook Capital and York Capital, which have acquired a substantial portion of Monier's EUR 2.1bn debt in recent months at a significant discount, were to table a counter offer to obtain a controlling interest in the business. This is expected to be finalised in the coming week after discussions with other debtholders, and could see the syndicate underwrite a EUR 200m investment into the business by all lenders and a cut in debt to EUR 700m.

PAI acquired 65% of Monier from Lafarge group in a deal valued at EUR 2.4bn deal in February 2007. Lafarge, which retained a 35% stake at the time of the 2007 buyout, is likely to lose its interest in the business under any proposal.

It is understood that the company has yet to breach its covenants, but that it is struggling to meet a EUR 65m interest repayment, due next month.

Earlier this week PAI lost control of another of its investments, when it reached agreement with Philips to sell Italian coffee machine manufacturer Saeco for a reported EUR 200m - less than the companies EUR 500m debt.

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