Plans to split Folli Follie into two firms

Plans to split Folli Follie into two firms

The creditors of the troubled Folli Follie Group – banks and bondholders – are examining all possible options for the listed company’s future as there is a growing feeling that it will not emerge unscathed from its crisis regardless of the correctness of its financial reports.

Kathimerini understands that there will be an effort to convene the majority of the company’s bondholders this month to decide on their legal steps. The reason for this is because, although Folli Follie appears to be servicing its obligations normally for now, there is the fear in the market that legal action by small stakeholders, the Capital Market Commission or others is just a matter of time; that would lead to a detailed probe and the freezing of accounts and other Folli Follie assets either by financial prosecutors or by anti-money laundering authorities.

Therefore, two options are being examined: either to split Folli Follie into “good” and “bad” companies, with the latter concerning its exposure in Asia, where the biggest uncertainties regarding its actual commercial activity and validity of financial data are located; or to set up a new company that will retain Folli Follie’s holdings and another to undertake its commercial activity. In both scenarios the main stakeholders will be its creditor banks and bondholders.

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