Chancellor Merkel said she has not seen a restructuring plan from either Schaeffler or car maker Opel, which is also requesting government support, yet. "I regard [liquidity] guarantees as the tool we are eyeing," Merkel told journalists, according to Dow Jones. “Germany has an interest in strengthening companies which have a strong foundation,” Reuters quoted Merkel as saying.
Meanwhile, Schaeffler continues to investigate the possibility of debt-for-equity swaps as a means of paying off some of the multi-billion euro loan it borrowed to buy Continental AG. According to Bloomberg, financial institutions such as government-controlled Royal Bank of Scotland Group, which backed Schaeffler’s takeover of Conti, may “saddle taxpayers with distressed assets as they negotiate debt-for-equity swaps with failing corporate borrowers.” (Tyres & Accessories/Staffordshire, U.K.)
