On Monday, a European derivatives committee declared Casino (CASP.PA), France’s debt-laden retailer, has not had a bankruptcy credit event, dashing investor hopes for a credit insurance payout.
On Friday, according to its website, the EMEA Credit Derivatives Determination Committee (CDDC) discussed an investor’s question.
Last month, the severely indebted French retailer launched court-backed talks with creditors after getting their approval to open conciliation without triggering a Casino bond default.
On Monday, the CDDC said it reviewed previous cases, including Casino’s holding company Rallye, in making its decision. (GENC.PA)
The group also examined French conciliation, which aims to reach a full creditor accord. However, it observed that a partial agreement does not bind creditors who do not approve. Thus additional measures to get them on board would be pursued.
The statement noted that conciliation would supersede debt instrument defaults under French law.
The CDDC found this insufficient to cause a bankruptcy credit event.
The committee was asked Friday if Casino had a “failure to pay” credit incident. The committee is considering accepting the question.
Credit events can cause credit default swaps to pay out.
As of May 19, DTCC reported $428 million in net notional Casino CDS.
Casino has struggled for years with heavy debt from acquisitions, dwindling income, and market share loss in a competitive domestic market.
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