HUNGARY - Permira's BorsodChem to get cash injection

Hungary initially announced its intention to throw a lifeline to BorsodChem earlier this year in an attempt to thwart the laying off of up to a fifth of its 3,600-strong workforce.

The move comes after the business failed to sell its PVC unit earlier this year. That was meant to raise cash for the debt-laden company, which Permira acquired in late 2006 in a €1.63m deal. That transaction consisted of EUR1.1bn debt provided by Royal Bank of Scotland, UniCredit and Lehman Brothers. Since then, Houlihan Lokey was appointed adviser for the company while Close Brothers is serving as adviser to the senior lenders.

As part of this latest transaction, Permira is expected to inject between €80-90m to maintain control of the company, while junior lenders have been asked to swap €200m credit for equity. The company has been able to defer interest payments until August; though debt restructuring talks are still on-going.

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• Expansion
• CEE