The “whatever the cost” has not yet ended. The French government announced on Tuesday, June 1, the creation of a three billion euro transition fund to help large companies and those of intermediate size (ETI) in difficulty of financing because of the Covid-19 crisis.
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This system, which complements that of loans guaranteed by the State, “offers an intervention capacity in loans, quasi-equity and equity”, according to the support plan presented by the Ministers of the Economy, Bruno Le Maire, and of Justice, Eric Dupond-Moretti. The fund will be managed by the Ministry of the Economy, which will examine the applications, and contributions in quasi-equity or equity will have a “undetermined maturity” with rates that will vary depending on the duration of the loan, said Bruno Le Maire at a press conference.
This new system is financed by 1.8 billion euros not consumed out of 20 billion planned for the increase in State capital in companies in difficulty, by 600 million unused credits from the Economic and Social Development Fund and by 600 million new credits as part of the amending finance bill that will be presented Wednesday by the government, detailed Bercy.
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In addition, the government announced the launch for two years of a simplified bankruptcy procedure for companies in difficulty (in addition to the safeguard and receivership procedures, which continue to exist). This procedure, entitled “crisis exit treatment”, should allow individual companies whose workforce and balance sheet are below certain thresholds, which will be set by decree, “to rebound quickly thanks to a restructuring of their debt “, according to the press kit provided by Bercy. In order to allow expedited processing, “the liability is established on the declaration of the debtor and on reliable accounting elements” and “the observation period is closed within three months”.