The operator of the Tunnel rail linking France and Britain Eurotunnel asked a Paris court for protection from creditors on Thursday after failing to cut a deal to restructure its 9 billion-euro (11.5 billion-dollar) debt.

Eurotunnel's CEO, Jacques Gounon, told a news conference that the company had no alternative but to ask for court protection from its creditors, adding that it was "obligatory".

"We should have perhaps started a safeguard procedure earlier," he said.

Eurotunnel had said that it only had enough cash flow to keep the tunnel going until the beginning of next year.

It failed to reach an agreement with creditors to a deadline of midnight on Wednesday on a plan to more than halve its debt to 4. 24 billion euros and reschedule payments.

The ratings agency Standard and Poor's said that it had lowered its rating on Eurotunnel bonds to "C" from "BBB", reflecting the decision by the company to file for legal protection from its creditors.

A spokesman of the company quoted Gounon as saying: "I do not understand how a big institution such as Deustche Bank was able to maintain its unreasonable demands without appreciating the responsibility it was taking regarding 2,300 employees and 800,000 shareholders in Eurotunnel."

The committee representing the main creditors issued a statement saying that it "will continue its efforts to reach a consensus solution on financial restructuring".

The Paris commercial court set a date 12 days away on July 25 for its decision on the application.

Source: Xinhua