Headlines

Italian yellow pages publisher Seat Pagine Gialle has started talks with its largest creditor, Royal Bank of Scotland, raising hopes it may gain relief from its 3 billion euro ($3.88 billion) debt, Reuters reported today. The announcement on Monday comes after weeks of market speculation that Seat's private equity owners were studying a 250 million euro capital rise--which has not yet materialised--as a base from which to relaunch Seat's business into the Internet age.

The troubled German regional bank BayernLB said on Monday that it would shed more than a quarter of its workforce by 2013, with Asian operations slated to bear the brunt of a rigourous downsizing, Agence France-Presse reported today. A statement said BayernLB would eliminate 5,600 posts of a total 19,200 in a bid to save 670 million euros ($850 million) over the next five years. BayernLB “will be smaller and engaged in fewer activities, but it will emerge stronger, closer to its customers and less susceptible to incalculable risk," chairman Michael Kemmer was quoted as saying.

The investors buying Alitalia SpA will have to pay 130 million euros ($165 million) more for the insolvent Italian airline if they postpone the closing date, Il Messaggero reported, without saying how it got the information. Under a proposed new timetable, Alitalia would start operations under new ownership January 7 instead of in December, the newspaper said. Alitalia’s bankruptcy commissioner Augusto Fantozzi wants CAI, the group of Italian investors buying the carrier, to cover the 3 million euros per day that Alitalia loses until the new start date, Messaggero said.

The crash in Spain's real estate market claimed another big victim Friday as Promociones Habitat, a major developer, filed for protection from creditors holding 2.3 billion euros ($3 billion) in debt, the Associated Press reported. The Barcelona-based company said it continues to operate as usual and will try to finish the projects it has under way, but has no choice but to seek court protection as it tries to restructure its debt load. It was the second-largest bankruptcy filing stemming from the Spanish real estate crash, after Martinsa-Fadesa's in July.

South Korea tackled one big problem, bank liquidity, after the economic crisis went global in recent months. Now another problem is creating uncertainty: high levels of household debt. South Korea in the past five years has built some of the biggest levels of household debt in the world, The Wall Street Journal reported. Household debt increased to 66% of South Korea's gross domestic product last year from 38% a decade earlier, according to a recent study by the International Monetary Fund. As the economy slows, the high level of household debt could lead to more delinquencies.

Babcock & Brown’s international banking syndicate is mulling over a framework deal which will give the troubled asset management group breathing space for a few more months so it can seal the impending sale of some of its assets, The Sydney Morning Herald reported. The plan, which will require the backing of all members of the 25-strong lending group, could be approved over the weekend but only if the banks are satisfied B&B can deliver at a much quicker rate on its latest proposals to slim down its operations.

Morimoto Co., a property developer, filed for protection from creditors with 162 billion yen ($1.7 billion) of debt, bringing the number of bankruptcies among publicly traded companies in Japan to a postwar record, Bloomberg reported. The bankruptcy is the second-largest in Japan this year following Urban Corp.’s filing on Aug. 13. The company’s filing with the Tokyo District Court pushed the total in 2008 to 30, the most since World War II, based on information from Teikoku Databank Ltd., a bankruptcy research firm.

Centro Properties Group, the owner of 794 shopping malls in the U.S., Australia and New Zealand, is continuing talks with lenders to extend more than $4.5 billion of borrowings by Dec. 15 after failing to raise new capital, Bloomberg reported. The real estate investment trust may have to go into receivership unless creditors including Commonwealth Bank of Australia Ltd. and National Australia Bank Ltd. agree to roll over loans, Melbourne-based Centro said today in a statement.

Ailing Spanish property company Colonial said on Friday it could be forced into administration if it fails to sell stakes in other companies and complete a bond issue, Reuters reported. The company needs to sell subsidiary Riofisa, or a substantial part of it. It must also complete a 1.405 billion euro ($1.82 billion) convertible bond issue. Colonial has not said what the deadline is for selling all or part of Riofisa. It also has to sell 33 percent of its capital in SFL, a company in which it owns 84 percent, and all its 15.45 percent stake in Spanish property and service group FCC.

Half of Bulgaria's 4,600 textile firms could go bankrupt and some 48,000 people lose their jobs next year due to weak demand as a result of the global financial crisis according to industry officials, Balkan Insight reported. The Balkan country's textile industry, which exports 80 percent of its output to European Union countries, has already felt a sharp drop in orders and was working at 50 percent of its capacity, said Georgi Topchiev, head of the textile producers union.