Belvédère settles debt controversy

Belvédère settles debt 'controversy'

Embattled drinks group Belvédère has said that it has paid back a further EUR15m (US$20.5m) of debt in order to silence doubts about its finances.

Belvédère said yesterday (26 January) that its unscheduled debt payment, completed earlier this week, comes in response to claims from the Bank of New York Mellon, which represents some of its creditors, that the company has not met its commitments relating to the interest on debts.

The EUR15.08m paid out this week corresponds to the amount cited in the Bank's complaint, but Belvédère said it only paid out "in order to put an end to this controversy and demonstrate the good financial health of Belvédère". It paid the sum to an executive commission, which is charged by the French courts with overseeing the Sobieski vodka maker's emergence from bankruptcy protection.

As part of that process, Belvédère has agreed to pay off debts over a ten-year period. It repaid its first tranche of debt, EUR23m, on 10 November last year.

The group owes around EUR375m in total. If interest is included, the company has projected it will have paid out EUR781.5m by 2019. However, the firm said it has a court order freeing it from interest payments on the debt load until 15 May 2013.