Seat PG agrees size of bond swap with creditors -sources

A weak advertising market in Italy compounds the company’s problems and further complicates a tough restructuring.To stave off the risk of default, Seat shareholders are trying to reach an agreement with the holders of a 1.3 billion euro Lighthouse bond.”There is an outline agreement on converting into shares about 1.2 billion euros of the Lighthouse bond, but positions are still distant on the conversion prices,” one of the sources said.A second source confirmed it.The Lighthouse bond trades at a price of about 15 on the market . The bondholders have it in their books at a price of around 40.The three private equity firms that control about 50 percent of Seat’s capital — Permira , CVC Capital and Investitori Associati — have put forward an offer to convert the bond at market prices.”There has been no formal answer from bondholders,” one of the sources said.A conversion price of 15 would hand bondholders shares totalling less than 200 million euros.Seat’s market capitalisation was 89 million euros at Wednesday’s prices.Lighthouse bondholders are due to receive a 52 million euro coupon payment at the end of the month.Sources have told Reuters that Seat does not intend to pay the coupon unless there is a debt restructuring agreement or a green light from other creditors, to avoid possible legal action.But a missed coupon payment could see Seat put into a special managed administration procedure.To allow talks to continue, creditors could grant a waiver by authorising the payment to be delayed.