(Bloomberg) -- A key representative for the biggest investor in BayWa AG signaled willingness to support the German commodities trader that’s burdened by a big debt load.
“We will demonstrate solidarity. We will walk this path constructively together,” Gregor Scheller, the outgoing head of the Bavarian association of cooperative banks GVB, said about BayWa, according to a report by newswire dpa-AFX. A spokesman for GVB confirmed the comments to Bloomberg on Thursday.
The Munich-based company faces a potential restructuring of its liabilities after piling up billions of euros in debt. It’s been hit by a confluence of events including higher financing costs, a price war between solar panel players and a slump in commodity prices. In April, it pulled the sale of a bond after it struggled to attract enough orders for it.
The cooperative banks are the largest shareholders in BayWa, owning a stake of about 34% stake via a holding company known as BRB AG. GVB represents the cooperative banks. Scheller was appointed chairman of BayWa’s supervisory board in May.
BayWa is working with consultancy Roland Berger on a restructuring opinion, which will give a view on a company’s debt sustainability, while Rothschild & Co is acting as an adviser, people familiar with the matter have said. Lenders to the firm have hired Willkie Farr & Gallagher LLP for advice, Bloomberg has reported.
BayWa has scrapped its full-year guidance, citing an inability “to provide a sufficiently reliable, specific new forecast for earnings before interest and tax.”
The company “remains in constructive talks with its financing partners,” it said in a statement on Wednesday. “The board of management continues to believe that the financial situation can be lastingly improved.”
It said that it’s delaying publication of its half-year financial statements to Sept. 27.
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