La Polar Seeks Covenant Waiver, Share Issue

Chile’s la Polar plans to raise $400m equivalent from the sale of new shares and ask bondholders to waive covenants after loan-loss provision estimates rose to CLP538bn ($1.14bn). The retailer had forecasted earlier this month a loan-loss provision of about CLP200bn after irregularities were detected at its consumer credit business, resulting in the firing and reshuffling of officials. La Polar will ask shareholders for the sale of $400m in new shares in a meeting Wednesday, a capital increase that was originally to go towards expansion plans. It also intends to ask bondholders to waive bond payment acceleration and default covenants in a meeting June 29. La Polar and financial adviser Larrain Vial are also working on a proposal to extend maturities of bank loans.