'Painful' restructuring gets Senator's vote
Insolvency strategy decision due June 17
Insolvency administrator Rolf Rattunde, who will present the plan at a June 17 shareholders' meeting, is confident shareholders will give it their blessing even though it will greatly reduce the value of their stock.
As part of the plan, Deutsche Bank London has agreed to take over Senator's outstanding debt of $203 million from a consortium of creditors headed by Bayerische Landesbank.
The scheme also foresees a 90% reduction of Senator shares on the market, which would raise the price of the remaining shares tenfold. A capital increase would follow, watering down the share price and making it easier for investors to come aboard but leaving current shareholders with a fraction of the value of their stock.
Will hurt investors
Rattunde admitted the plan would cause shareholders "a painful loss" but said shares would ultimately go up when a new investor came on board.
Shareholders have little choice: If they reject the plan, the insolvency administrator will be forced to dissolve the group and sell off the most valuable assets.
Senator's main production and distribution arms remain operational and last year enjoyed huge successes with local hits "The Miracle of Bern" and "Good Bye, Lenin!"
Rattunde said a number of companies were interested in Senator. Possible takers are said to include Constantin Film and its parent company Highlight Communications, Swiss-German distrib Falcom Media and private equity investment groups.
Senator's share price spiked 43% to 42¢ Thursday on news of the rescue plan.
