KKR Unit Takes on Italian Shipping Company Debt From Banks
Pillarstone Italy, owned by U.S private equity firm KKR, will take on the bulk of the debt owed by Italy's Premuda to a group of banks, in a first move that could make Pillarstone one of the main shareholders of the shipping company.
Under the deal, Banca Carige, UniCredit and Intesa Sanpaolo will transfer around 250 million euros ($281 million) in loans to Pillarstone, making it the main creditor of Premuda, a spokesman for the KKR unit said on Friday.
"Pillarstone will enter talks with other creditor banks to reach a final deal aimed at restructuring the whole debt," Premuda said, referring to its total net debt of 320 million euros at the end of 2015.
It added that a part of the debt held by the KKR unit could be converted into shares.
Headed by former Royal Bank of Scotland executive John Davison, Pillarstone said it would inject fresh funds into the indebted group, which recorded a loss of 81 million euros last year. Shares in Premuda closed at 0.1332 euros, up 21 percent on Friday.
The deal with Premuda is part of a broader strategy by Pillarstone to gain control of ailing Italian mid-cap companies by absorbing their debt from creditors and turning them around.
In 2015, the investment unit took on the debt of five companies including paper makers Burgo and Lediberg and theme parks manager Alfa Park.
Pillarstone is also expected to acquire a majority stake in Italian telecoms engineering group Sirti in the next few weeks from Intesa Sanpaolo and a group of private equity investors. .
(Reporting by Francesca Landini and Massimo Gaia)
