Sunday 28 March 2021 10:39 am

Eurostar in crunch talks with lenders over £400m debt pile

Eurostar is in emergency talks with its lenders to avoid collapse as the deadline for the repayment of its £400m debt pile nears. 

Passenger numbers on the Eurostar have plummeted 95 per cent since March as coronavirus restrictions have battered international travel.

The service is currently running just one service a day to both Paris and Amsterdam due to ongoing border controls.

The operator convinced its banks, which include Santander and France Agricole, to lend it hundreds of millions of pounds. The loan must be paid back by June with an option to extend for 12 months but this would require Eurostar to adhere to strict covenants. 

Eurostar is now in talks to secure lifeline funding with attention focused on restructuring its loans, the Sunday Telegraph reported. The company has been lobbying both the French and British governments for a bailout but it is yet to bear fruition. 

The company is 60 per cent owned by French state rail firm SNCF. The UK government sold its 40 per cent stake in the business to private companies for £757.1m in 2015.

Transport secretary Grant Shapps has said Eurostar “is not our company to rescue” but added “We’re very, very keen for the Eurostar to survive, and we’ll wait to see the plan [from state rail firm SNCF]”.

Last week SNCF chief Jean-Pierre Farandou told the Financial Times the operator was in advanced discussions to secure aid from the UK and France.

“We are getting closer to the moment when Eurostar will have real cash flow problems… By next month, we have to conclude these discussions”.

Today RMT General Secretary Mick Cash said: “It is essential that the government steps up and plays its part in creating a bridge to saving the Eurostar service.”

“They need to work with their French and Belgian counterparts, along with the financiers, to save this essential link which is a viable and green operator registered in the UK and supporting over 3,000 British jobs.”