Europe

Anglo-Swedish drugmaker AstraZeneca PLC plans 1,400 job cuts and is closing three plants around Europe as it joins others in the sector tackling increased competition and cost pressures, Reuters reported yesterday. The job cuts announced on Thursday are in addition to the 7,600 announced in July 2007 and will see AstraZeneca closing facilities at Porrino in Spain, Destelbergen in Belgium and Umea in northern Sweden.
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Creditors of French building materials manufacturer Terreal are urgently seeking dialogue with its private equity owner, LBO France, after Terreal defaulted on a 915 million euro loan, Reuters reported today. Terreal failed a leverage covenant test last Friday on the loan, which specified that its leverage ratio must be eight times and the company instead reported leverage of 8.4 times, banking sources said. Terreal's all-senior loan, which was arranged by ING, is now quoted in the secondary market at a steep discount of 22-32 percent of face value, which indicates distress.
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Iceland got a $4.6 billion bailout from the International Monetary Fund and four Nordic countries to help resurrect the island's economy after the failure of its biggest banks and the collapse of its currency, Bloomberg reported today. The Washington-based IMF approved a $2.1 billion loan late yesterday. Finland, Sweden, Norway and Denmark will provide a further $2.5 billion, the Finnish Finance Ministry said in a statement today. Approval of the loan dragged out after Iceland was unable to reach agreement with U.K.
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Pepsi Bottling Group Inc., the world's second-largest soft-drink distributor, lowered its 2008 earnings forecast and said it will eliminate 4.6 percent of its workforce in North America, Europe and Mexico, Bloomberg reported. Pepsi Bottling, which is 33 percent-owned by PepsiCo Inc., will cut 3,150 jobs, mostly in Mexico. Earnings per share will be $2.20 to $2.26 this year, down from the $2.32 to $2.38 Pepsi Bottling forecast in June, the Somers, New York-based company said today in a statement. The shares fell in New York trading.
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Spanish property group Tremon on Monday said it had filed for administration after failing to meet debt payments, hurting shares in banks which have total exposure of around 1 billion euros ($1.27 billion), Reuters reported. Tremon is the second large Spanish property group to seek administration this year following Martinsa Fadesa. Among its biggest creditors are Banco Popular, with around 200 million euros exposure, unlisted savings bank Bancaja with 100 million followed by Banco Pastor with 95 million.
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PIK Group, one of Russia’s largest residential construction companies, plunged as much as 43 percent in London on Monday after JPMorgan Chase & Co. downgraded the developer to "underweight" from "overweight" on concern that it may default on some debt, The Moscow Times reported today. The developer may be unable to repay $700 million of debt due this year as the Moscow city government seeks to overturn housing orders PIK won in October and renegotiate prices, Elena Jouronova, a property analyst at JPMorgan in Moscow, wrote in a note to clients Monday.
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German Chancellor Angela Merkel said Monday after meeting with leaders of Adam Opel GmbH that it was "not yet determined" whether the automaker would be given 1 billion euros ($1.25 billion) in loan guarantees from the government, the Associated Press reported yesterday. Opel, a subsidiary of General Motors Corp., is seeking the guarantees because the company expects difficult credit conditions on the open market due to the world financial crisis. Merkel said that government officials planned further talks on the issue and should come to a decision by Christmas.
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Eighty-five companies worldwide defaulted on their debt in the year through November 11, impacting a total of $284 billion, up sharply from the two previous years, Standard & Poor's said Monday. By comparison, there were only 22 defaults for all of 2007 and 30 in 2006, Reuters reported. Seventy of the 85 companies are based in the United States, five in Europe, four in Asia, three in Canada, two in Mexico and one in Russia, according to Diane Vazza, head of S&P's fixed income group.
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Troubled Italian airline Alitalia's debts have soared to some 2.3 billion euros, the company's special administrator said Sunday as a pilot and air crew strike caused a seventh day of cancelled flights, Agence France-Presse reported today. Augusto Fantozzi told RAI television he had "around two billion in ordinary debt for the supply of goods and services," before taking into account a 300-million-euro government loan. Alitalia's last publicly recorded debts going back to mid-2008 were 1.2 billion euros, although that figure did not include bills from suppliers.
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