New Eurotunnel shares plummet 02/07/2007 00:00

PARIS, July 2, 2007 (AFP) - New shares in the restructured operator of the Channel tunnel rail link between Britain and France, Groupe Eurotunnel, fell by more than 44 percent on Monday on the first day of trading.

The company announced last Friday that it had completed its restructuring after agreeing a deal with creditors to slash its debt and convert shares in the near-bankrupt Eurotunnel into new shares in Groupe Eurotunnel SA.

In midday trading Monday on the Paris stock exchange, shares in the new group known as GET SA showed a loss of 44.16 percent to 43 euro cents.

Shares in the old Eurotunnel, which are to be de-listed, were down 6.49 percent to 72 cents.

One broker cited investor prudence given the likelihood that GET SA would carry out a capital increase at an unspecified date and the fact that analysts which followed the company had set a target price well below the current level.

Societe Generale analysts see the company's stock trading around 26 euros cents withing 12 months and expect a capital increase by the end of 2007.

Eurotunnel chairman Jacques Gounon confirmed Friday that such a project existed but did not provide details on dates or the amount under consideration.

Since its formation in 1986, the Channel tunnel operator has struggled to make money, owing to larger than expected construction costs and lower than estimated traffic through the tunnel.

Shares in the old Eurotunnel group had risen sharply before the share exchange deal, which enabled shareholders to swap their shares one-for-one in the new entity.

Copyright AFP

Subject: French news