Eurotunnel 'close to debt deal'

Eurotunnel is fighting for its survival

Channel Tunnel operator Eurotunnel has said it is close to restructuring its £6bn ($11.4bn) debt pile.

The Anglo-French group said it is in "advanced negotiations" with investment banks Goldman Sachs and Macquarie.

Its shares were suspended on the Euronext exchange on Monday ahead of the news, having already been suspended on the London stock exchange on 2 May.

French media reports said construction group Vinci could be asked to invest in the project or run it for the banks.

"We know some of our high-risk creditors would be happy to get out if there was a bit of cash around," a Eurotunnel spokesman said.

"We're looking for our shareholders to get value, we're looking for our creditors to get some value and we're looking for the company to have a future."

Formed in 1987 to run the rail tunnel linking the UK and France, the company has struggled ever since it first opened in 1994.

Passenger numbers have been substantially below those estimated in its business plan, and it soon emerged that paying off the huge debts accumulated building the tunnel would be difficult.

It announced 900 job cuts last year as it tried to reduce costs, but has not been helped by falling passenger numbers.

Its revenues for the first quarter of 2006 totalled £131.5m, slightly down on the £131.6m a year earlier.