After six months of negotiations, all the 116 lenders to Vivarte have accepted to write-off €2.0 billion of the debt €2.8 billion that resulted from the company's leveraged buyout in 2007. In exchange, they are getting shares or convertible bonds in the company.

With its numerous shoe and apparel retail chains, Vivarte is the largest shoe retailer in France. Its footwear chains include André, Besson, Chaussland, Minelli, San Marina and La Halle aux Chaussures. They represent about half of its annual turnover of around €3 billion.

A dozen creditors have also agreed to inject €500 million to finance the opening of new stores and other elements of the reorganization plan proposed by the company's chief executive, Marc Lelandais.

French court authorities have endorsed the transaction. Charterhouse, which had led the leverage buyout of Vivarte in 2007, will no longer own the majority of the shares. It had a stake of 64 percent in the company. Indicating that they had no choice, as the alternative would have been a liquidation of the company, a spokesaman for the group tells us that all or most of the former shareholders will have to pull out.

Because of the holidays, no details could be obtained on the mechanics of the change of ownership, the new equity structure or the new business plan of the group by the time of going to press. Twelve lenders will basically own all of the shares. One of them, the Oaktree Capital Group, is said to be emerging as Vivarte's biggest new shareholder. It previously had a 10 percent stake in the company. Three others - Alcentra, Golden Tree and Babson - are joining it as “anchor shareholders,” says a press release, without adding any details.

We hope to be able to provide more information after the holidays.