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Swissair denies rumours of debt waivers

Media reports said Swissair would go under without debt waivers Keystone Archive

The beleaguered Swissair Group has denied media rumours that it is negotiating debt waivers with some of its banks. It has described the rumours as "wholly inaccurate".

The speculation followed a report in the “SonntagsZeitung” of Zurich which claimed that without debt waivers, the group was not in a position to survive.

At the stock exchange, shares in Swissair hit a nine-year low before recovering slightly. The share price fell by more than five per cent and closed at SFr78.90 ($46.7).

Analysts have said investors are worried that the group’s policy of aiming to sell its most profitable units will make it impossible for it to return to profit.

Accelerating repayments

In a statement from its headquarters in Zurich, the Swissair Group repeated that on its own accord, it was accelerating its bank debt repayments with full repayment expected before the end of 2002.

The Group is in compliance with all agreements relating to its borrowings and will continue to make all payments of interest and principal as they fall due, the statement said.

To achieve the acceleration in debt reduction and improve its equity position, the group is planning to dispose of a majority of its Swissport ground handling business this year and either its entire holding or a majority share in the Nuance airport retail business in early 2002.

The group said the sale, together with action already announced, should total more than SFr4.5 billion $2.68 billion of disposals and asset financings over the next 18 months.

It added that this would enhance the liquidity position of the group and strengthen the equity base in a “significant” manner.

The group, which made a loss of SFr2.9 billion in 2000, announced last month a loss of SFr234 million for the first six months of this year.

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SWI - a branch of Swiss Broadcasting Corporation SRG SSR

SWI - a branch of Swiss Broadcasting Corporation SRG SSR