Vivendi’s loan talks
The owner of the world’s largest music and video-game companies Vivendi SA suffered a setback in its plan to obtain a 1 billion-euro credit line as Europe’s sovereign debt crisis leaves no haven in core countries. According to three people with knowledge of the talks the Lenders are demanding Vivendi SA pay an interest rate of 90 basis points more than the euro interbank offered rate that above the 75 basis points Vivendi offered. Vivendi SA is the Paris-based company.
European companies had raised record a $503.9 billion of loans in this year to refinance debt amid growing concern which the cost of funds for all nations will rise further as they struggle to reduce debt loads after Portugal, Greece and Ireland needed to be bailed out. According to data compiled by Bloomberg the average interest margin banks charge investment-grade companies in the France for loans jumped from an average of 48.8 in the first eight months of the year to 60 basis points.
On Dec. 9 2011, a London-based analyst at Mizuho Securities Roger Francis said in a telephone interview “Banks are passing that on to their clients and they are pretty constrained in their access to liquidity.”
