BUSINESS

QCM head: FFG's loan problems could mark 'beginning of the end'

ELEFTHERIA KOURTALI

TAGS: Business

News that a creditor of luxury jewelry maker Folli Follie Group has terminated its loan agreement with the company could be the beginning of the end for the troubled firm, Gabriel Grego, the head of equity fund Quintessential Capital Management (QCM), told Kathimerini on Thursday.

Folli Follie’s shares plunged in May after QCM issued a report that raised concerns over its reported finances.

Earlier this month, the Capital Market Commission slapped Folli Follie and nine compnay representatives with fines of 4.02 million euros for market manipulation and violation of rules regarding data submission.

“It would seem like this is the beginning of the end for Folli Follie. The other creditors are likely to follow, claiming default or breach of covenant, and demand immediate repayment of outstanding loans/bonds,” he said.

The question is whether Folli Follie will be able to repay these debts within a reasonable time frame, Grego added. “Obviously the only way to answer this question is to wait for the results of the forensic accountants and Ernst & Young.”

If the company is unable to repay its debts at once, its alternative options would include a total liquidation of its assets and some form of debt restructuring, he said.

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