Headlines

Congo Republic’s government said it’s reached agreement with the International Monetary Fund on three key areas as it seeks a bailout from the multilateral lender, Bloomberg News reported. The oil-producing central African nation owes creditors at least $9.14 billion and is struggling to pay its debts because of a decline in oil prices since 2014. The government sought support from the IMF last year.

It wasn’t so long ago that Suruga Bank Ltd. was seen as a model for how Japanese lenders can survive in an era of rock-bottom interest rates and weak loan demand. The regional bank was hailed for generating the best loan margins in the country, thanks to its focus on individual borrowers who were shunned by its risk-averse competitors. Now, Suruga has come unstuck for giving credit to investors in failed real estate investment projects, prompting Japan’s financial regulator to investigate the company’s lending practices, Bloomberg News reported.

Brussels is investigating whether €900m in bridging loans to Alitalia from the Italian government were illegal under the bloc’s state aid rules. The Italian airline filed for bankruptcy on May 2, 2017 and was provided with two loans from the national government — €600m in May and a further €300m in October, the Financial Times reported. The European Commission announced its probe on Monday. It will investigate concerns that the loans were not repaid within six months and may have been larger than necessary.

On Sunday, a Tel Aviv district court judge ordered the liquidation of Eurocom Communications Ltd., the communication arm of Israel-based Eurocom Group, and ordered its real estate arm into receivership, CTech reported. Eurocom's most attractive asset is Bezeq, Israel's biggest telecommunication provider and a monopoly in the country, which it holds through subsidiaries. Attempts to sell Eurocom were stymied due to shareholders opposition in Bezeq. The directives will take effect on May 3rd. The judge did not approve Eurocom's creditor arrangements.

Sajjan Jindal-controlled JSW Steel has written to the committee of creditors (CoC) of Essar Steel on inviting fresh bids for the bankrupt firm, Business Standard reported. This has come ahead of the meeting of the CoC on Tuesday. About a month ago, JSW Steel had written to the committee, expressing its interest in taking part in bidding for Essar Steel. However, the CoC had decided not to invite fresh bids owing to time constraints.

Irish toys group Smyths Toys has signed a deal to take over Toys ‘R’ Us in Germany, Austria and Switzerland, the German arm of the insolvent retailer said on Saturday, Reuters reported. Once the largest U.S. toy retailer, Toys ‘R’ Us abandoned a plan to emerge from bankruptcy last month and said it would try to maintain more profitable locations in Europe and Asia as an on-going business while liquidating its U.S. and UK operations. Family-owned Smyths will acquire 93 shops and four online stores via the planned deal, Toys ‘R’ Us said in a statement on its German website.

In a related story, the International New York Times reported that Canada's Fairfax Financial Holding has placed a bid of $300 million to buy Toys R Us's Canadian operations in bankruptcy. According to court papers filed late Thursday, the bidder is taking on a role of a "stalking horse" in a court-approved auction set for Monday in New York. That means it could be outbid in the auction if other buyers come in with a higher offer.

With Venezuela and its state-owned companies behind on $3.4 billion of bond payments, a group of creditors has joined together to consider their next steps and selected Millstein & Co. as financial adviser. The group will seek to evaluate the financial condition of Venezuela’s government and state oil producer Petroleos de Venezuela SA and “consider financing alternatives under an appropriate policy scenario,” according to a statement, which doesn’t detail which institutions are included in the committee or how much debt they hold, Bloomberg News reported.

Libyan telecommunications company LAP GreenN is considering chasing after Zambia’s offshore assets after the southern African country defaulted four times on an order to pay $257 million in compensation for nationalizing a firm it invested in, Bloomberg News reported. Zambia owes state-owned LAP GreenN more than $400 million including interest, and has defaulted on payments totaling about $220 million following a 2016 judgment in the nation’s high court, according to the Libyan Post, Telecommunication and IT Holding Co. which owns LAP GreenN. Yields on the nation’s dollar bonds climbed.

Japanese equity funds posted their biggest net outflow since 2001 as investors regained their taste for risk assets in the past week and directed cash to emerging market equities and junk bonds, the Financial Times reported. The moves come as fears of a trade war eased and investors instead expressed optimism about strong earnings growth for US companies, which have begun reporting results for the first three months of the year.