Creditors seek to end Folli Follie protection

A group of Folli Follie’s creditors are calling for an injunction protecting the Greek jewelry maker’s assets to be lifted, saying they are due 44.5 million euros.

Greek authorities opened an investigation into Folli Follie earlier this year after equity fund Quintessential Capital Management (QCM) alleged the company had overstated the number of retail outlets it operates worldwide, raising concerns over its reported finances.

Folli Follie’s shares plunged in May after the QCM report, prompting the Greek securities regulator to suspend trading on the shares on May 25 after the firm failed to provide requested financial data.

Folli Follie, which employs about 5,000 people, has obtained a temporary court injunction to protect its assets. But ahead of a court hearing set for Wednesday, Alpha, National, Eurobank and Piraeus declared loans totaling about 44.5 million euros to Folli Follie “immediately due and payable,” Folli Follie said in a bourse filing on Tuesday.

The banks have asked the court to dismiss the company’s pending asset protection application and reject extending the temporary court injunction, it said.

Folli Follie said it would immediately start discussions with its creditors to find “arrangements” so the banks could support it at the court hearing later this week.

Last week Folli Follie pushed back its annual shareholders meeting, due on October 10, saying it expected the conclusion of a financial audit by then.

[Reuters]