Vestas agrees new debt deal

DENMARK: Vestas has agreed a €900 million loan with its lenders as it seeks to restructure the business following a downturn in customer demand.

Vestas said the loan consists of a €650 million revolving credit facility and a €250 million amortising loan.

The agreement means that cash-strapped Vestas will not be required to issue shares. the turbine maker said the revolving credit facility would expire in January 2015.

In July, the UK's Sunday Times said Vestas' banks, including HSBC and Royal Bank of Scotland, had told the company to prepare a debt restructuring plan.

The newspaper said the banks had appointed Ernst & Young to handle talks with Vestas, which has itself brought in PWC to handle the restructure. The report quoted Vestas debts as around €2 billion.

In a statement about the loan agreement, Vestas said the loans were calculated following a review of its upcoming requirements. The company has been cutting production and R&D jobs in several markets over the last year, with more planned for 2013.

Vestas CEO Ditlev Engel said: "We are satisfied to have reached an agreement with our lenders. It is in the interest of Vestas to reduce our debt, and we now look forward to focusing all our efforts on the continuous development of a more scalable Vestas."