Anglo-French tunnel operator Eurotunnel yesterday entered a new round of talks to avert bankruptcy after seeking protection from the French courts over its £6.2 billion debt mountain.
Eurotunnel announced the move on Tuesday after hours of meetings with major creditors aimed at securing a debt restructuring plan the Channel Tunnel operator says is key to its survival.
"We don't despair of finding an agreement, but all options must be considered and the company therefore found itself obliged to place itself under court protection," spokeswoman Mady Chabrier said.
The legal procedure can be lifted if a debt restructuring agreement is reached, she said.
Eurotunnel chairman Jacques Gounon was yesterday hoping a deal with creditors could be reached by midnight last night. Any agreement would then be put to shareholders in Calais on July 27.
But if not, he has already said he plans to file for bankruptcy.
Eurotunnel stressed that whatever the outcome of the talks and the future of the company, the uninterrupted running of trains through the tunnel was secured.
Force Ouvriere, one of the staff unions, said Mr Gounon briefed the European Works Council on Monday on the situation and the union said it had a "cold shower" and feared job cuts.
Representatives owning 75 per cent of the most junior debt need to agree with Eurotunnel's debt deal but they are just one group among many, some with higher ranking rights and different voting structures.
Founding creditors, such as the European Investment Bank and European Coal and Steel Community, have a final veto.
Eurotunnel took on massive debts due to the soaring costs of digging the Channel Tunnel linking Britain and France.