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       T R O U B L E D   C O M P A N Y   R E P O R T E R

                          E U R O P E

          Wednesday, April 7, 2021, Vol. 22, No. 64

                           Headlines



F R A N C E

AIR FRANCE-KLM: France Injects EUR4 Billion Into Business


R O M A N I A

METROREX: Romania's Transport Ministry Mulls Rescue Options


U N I T E D   K I N G D O M

CARILLION PLC: Peter Meehan Leaves KPMG Amid Audit Probe
GFG ALLIANCE: Steel Plants Scramble for Funding to Meet Carbon Bill
PEACOCKS: Bought Out of Administration, 2,000 Jobs Saved
TRAVEL DAY: Enters Into Administration, Seeks Buyer for Business

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F R A N C E
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AIR FRANCE-KLM: France Injects EUR4 Billion Into Business
---------------------------------------------------------
David Keohane at The Financial Times reports that France will
contribute up to EUR4 billion to strengthen Air France-KLM's
balance sheet, potentially doubling its shareholding as it tries to
steer the airline through the worst of the Covid-19 pandemic.

According to the FT, the French state, which is already a 14.3%
shareholder, will convert EUR3 billion in loans it gave to Air
France last year into perpetual hybrid debt and take part in a
planned additional capital raise for up to EUR1 billion.

Overall, the government's shareholding could rise to 29.9%, making
it the largest single shareholder, French finance minister Bruno Le
Maire told radio station France Inter on April 7, the FT notes.

"This gives us stability  .  .  . despite all the uncertainty
that we have in our industry today," the FT quotes Benjamin Smith,
the airline's chief executive, as saying.

"We have put together a very extensive, medium to long-term plan,
which with the evolution of the union agreements that we have in
place, we believe we can have the platform to really make Air
France profitable," he added.

This volley of state aid will only benefit the French arm of Air
France-KLM, said the EU, the FT states.

The Dutch state, which is also a 14% shareholder, will not
participate in the new capital raise, Air France-KLM said in its
statement, but "is continuing discussions with the European
Commission regarding potential capital-strengthening measures for
KLM," the FT relays.

After months of negotiation between France and the EU to get the
state aid approved, Air France-KLM had to give up 18 of its more
than 300 landing and take-off slots at Paris-Orly, the FT recounts.


The commission, as cited by the FT, said on April 7 that France had
committed to working out a credible exit strategy within 12 months
after the aid was granted, unless the aid reduced below 25% of
equity by then.

It added that until the recapitalisation was redeemed, Air France
was banned from paying dividends and making share buybacks, the FT
notes.  There are also limits on pay and bonuses, the FT states.

Cash burn at Air France is running at EUR10 million a day, said Mr.
Smith, with good momentum in the US market potentially capping
further cash burn due to EU restrictions, according to the FT.

Mr. Smith expects group cash burn to reach zero in 2023 but said
that with "almost EUR9 billion in cash . . . for the short term to
medium term liquidity is not a question," the FT discloses.

On top of the EUR3 billion loan directly from France, Air
France-KLM had received EUR7.4 billion in loans guaranteed by the
French and Dutch governments to help it through the pandemic, the
FT says.  The French state-backed loan, which comes with cost and
environmental targets, has been extended until 2023, with the Dutch
loan due in 2025, the FT discloses.




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R O M A N I A
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METROREX: Romania's Transport Ministry Mulls Rescue Options
-----------------------------------------------------------
Andrei Chirileasa at Romania-Insider.com reports that increasing
the price of metro tickets in June, suspending the 18% wage hike
for four months, and cutting the weekend and holiday bonuses are
among the main actions pondered by the Transport Ministry to
improve the balance of Bucharest subway operator Metrorex by RON100
million (EUR20 million).

This way, the company could avoid cash flow problems in 2021,
although remaining in the loss area, Romania-Insider.com states.

Metrorex estimates losses of RON230 million (EUR46 million) in
2021, RON63 million (EUR12 million) more than last year's RON167
million losses, Romania-Insider.com relays, citing a draft
consulted by Economedia.ro.

This would result in a cash deficit of RON100 million -- which is
what the Government wants to avoid, Romania-Insider.com notes.

The draft was reportedly presented at the Metrorex Board of
Directors' meeting on March 30, when the Board concluded that there
is "a major risk of insolvency due to the impossibility of covering
the company's expenses", Romania-Insider.com discloses.

In this context, transport minister Catalin Drula said that "There
are only two simple mathematical options: either a renegotiation of
salaries is accepted, or people are made redundant.  There is a
third option: insolvency.  An insolvent company can also make pay
cuts and layoffs."




===========================
U N I T E D   K I N G D O M
===========================

CARILLION PLC: Peter Meehan Leaves KPMG Amid Audit Probe
--------------------------------------------------------
Michael O'Dwyer and Tabby Kinder at The Financial Times report that
the partner who led KPMG's audit of Carillion, the collapsed
government contractor, has left the Big Four firm as the UK
accounting regulator's investigation into the scandal reaches an
advanced stage.

Peter Meehan was suspended by KPMG in January 2019, along with
three other members of staff, after an internal investigation
raised concerns over information provided to the Financial
Reporting Council for its annual review of audit quality, the FT
recounts.

Mr. Meehan left KPMG on January 31, the FT relays, citing a
corporate filing published on March 31.

The FRC is conducting a long-running probe into KPMG's role in the
collapse of Carillion, the FT discloses.  The auditor gave the
outsourcing giant's accounts a clean bill of health just nine
months before it collapsed in January 2018, owing more than GBP1.3
billion to its banks, with a pension deficit of about GBP800
million and just GBP29 million in cash on its balance sheet, the FT
relays.

In a parallel investigation, the FRC is also examining whether
audit files provided by the Carillion audit team to the regulator
may have been deliberately backdated, the FT notes.

According to the FT, a person close to the situation said it was
likely that KPMG had agreed the financial and legal terms of an
exit from the partnership with Mr. Meehan, ahead of a potentially
damning decision by the FRC.

If KPMG does not agree to a settlement with the FRC, it is likely
to face a tribunal to determine any wrongdoing by the firm or its
auditors, and the size of any fine, the FT states.

KPMG, the FT says, is also facing a GBP250 million negligence suit
by the UK's official receiver, the public official charged with
liquidating Carillion.


GFG ALLIANCE: Steel Plants Scramble for Funding to Meet Carbon Bill
-------------------------------------------------------------------
Sylvia Pfeifer and Robert Smith at The Financial Times report that
Sanjeev Gupta's eastern Europe steel plants are under growing
pressure to secure more than EUR100 million in funding to meet a
carbon bill and avoid a steep fine under the region's emissions
trading scheme.

The carbon credit shortfall is the latest sign of financial strains
facing the industrialist's GFG Alliance empire, after the collapse
of its main lender, Greensill Capital, the FT notes.

Mr. Gupta has been racing to secure alternative long-term financing
for his empire, a loose collection of businesses that face
potential collapse after creditors filed applications in London's
insolvency court to wind them up, the FT relates.

The FT revealed in March that the eastern Europe plants, part of
his Liberty Steel Group, were ascribed a negative equity value of
US$2.6 billion after debts of US$1.6 billion by advisers to GFG
under a restructuring plan called "Project Battery".

The industrialist's Romanian plant, Liberty Galati, sold an
estimated EUR100 million in carbon credits last year after being
awarded them under the EU's Emissions Trading Scheme, ETS, the FT
discloses.

Galati sold its allowances for 2020 early last year but is now
scrambling to secure the necessary funding to buy back enough to
cover its emissions over the past 12 months, the FT relays, citing
two people familiar with the situation.

An added challenge is that the price of permits on the EU carbon
market has soared in recent weeks, increasing the cost for
polluters, the FT notes.

According to the FT, one person familiar with the situation said
Galati is in talks with its sister plant in the Czech Republic,
Liberty Ostrava, to see if it might be able to provide some spare
allowances.


PEACOCKS: Bought Out of Administration, 2,000 Jobs Saved
--------------------------------------------------------
BBC News reports that the collapsed fashion chain Peacocks has been
bought out of administration, a move that includes transferring
2,000 jobs and 200 shops.

The number means the other half of the 400 trading at the time of
the chain's collapse last November will not reopen as Peacocks, BBC
notes.

It was previously owned by Edinburgh Woollen Mills (EWM).

The buyers are an international consortium, led by Peacocks' former
chief operating officer, Steve Simpson, BBC discloses.

He hopes to reopen the stores once non-essential retailers are
allowed out of lockdown, BBC states.

EWM Group is a private investment group controlled by the Day
family, which is owed money by Peacocks and is supporting the
consortium.

According to BBC, a statement from the administrators, FRP, said
the collapse of the chain was due to "the devastating effects of
the Covid-19 lockdown" on the business.

The Peacocks' management team hope that, with the support of their
partners, suppliers and landlords, they will be able to reopen up
to 200 stores, BBC relays.

The statement added the company hoped all 1,850 store staff, who
are currently on furlough, will be able to return to work once
stores reopen, along with more than 150 in head office and support,
according to BBC.

A similar deal was set in place with EWM and Bonmarche brands,
while another of EWM's brands, Jaeger, was sold to Marks & Spencer,
which intends to run it as an online-only business, BBC recounts.

Peacocks had 400 stores going into the pandemic a year ago and
announced a series of job losses and store closures as it struggled
to manage under the various restrictions, BBC discloses.


TRAVEL DAY: Enters Into Administration, Seeks Buyer for Business
----------------------------------------------------------------
Business Sale reports that independent UK tour operator Travel Day,
headquartered in Swindon, has fallen into administration and a
buyer is being sought for the business and its assets.

The company specialises in arranging travel to long-haul
destinations and traded under a variety of names including Simply
Global Travel, Holiday USA, Caribbean Classics, and The Vegas
Wedding Company.

Mark Supperstone and Simon Jagger of investment and advisory
practice ReSolve have revealed that they have been appointed as
joint administrators of Travel Day, with trading ceasing
immediately, Business Sale relates.

According to Business Sale, in a statement, the administrators said
that the effects of the COVID-19 pandemic had posed a number of
challenges for the firm.  Mark Supperstone commented that he was
confident they would succeed in drawing interest from a number of
relevant parties when the travel operator hits the open market,
Business Sale relates.

"COVID-19 has been a challenging time for the travel industry and
has led to ReSolve spending a significant time working within the
sector, helping our clients survive the storm," Business Sale
quotes Mr. Supperstone as saying. "Yet even at the most difficult
of times during the pandemic we have consistently succeeded in
finding buyers for our clients' assets and brands. This is due to
their strong fundamentals and investors' understanding that the
travel sector will soon again pick up."



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S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter-Europe is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante,
Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A. Chapman,
Editors.

Copyright 2021.  All rights reserved.  ISSN 1529-2754.

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