Tokyo Electric set to receive $5.9 bln financing-source

Reuters

* Tepco to get Y200 bln loan rollover, Y300 bln newfinancing - source

* Tepco facility restart application helped convinceregional banks

* Shares reverse early losses, up 1.5 pct in mid-morning

By Taro Fuse

TOKYO, Sept 30 (Reuters) - Creditors are set to provide $5.9billion in financing to Tokyo Electric Power Co (Tepco), a person involved in the talks told Reuters on Monday,offering a lifeline to the embattled owner of the crippledFukushima nuclear plant.

Tepco's major banks are prepared to provide 500 billion yen($5.09 billion) in financing in December - 200 billion yen inloan rollovers and 300 billion yen in new financing - said theperson, who has been involved in financing talks as arepresentative of one of the utility's major creditors.

At the same time, Tepco's application on Friday to restartan undamaged nuclear plant helped convince some wavering smallerbanks to join a group of 28 financial institutions in rollingover 77 billion yen ($784 million) in loans due at end-October,the person said.

The utility's success in winning a refinancing of the loansdue next month was previously reported by the Nikkei and Asahinewspapers. The outcome of the larger funding round due inDecember has not been previously reported.

Tepco on Friday applied to restart its Kashiwazaki Kariwafacility, the world's largest nuclear plant in northwesternJapan, although approval is uncertain and any restart is manymonths away.

The company's president, Naomi Hirose, said in an interviewpublished on Sunday that Tepco will likely make its first profitin three years in the year to March - without raisingelectricity rates or restarting reactors.

Once Asia's largest utility, Tepco has posted more than $27billion in net losses since the March 2011 earthquake andtsunami triggered nuclear meltdowns at the Fukushima Daiichiplant. Tepco shares have fallen 71 percent since the disaster.

MAJOR CREDITORS

Major Tepco creditors include Sumitomo Mitsui FinancialGroup, Mitsubishi UFJ Financial Group andMizuho Financial Group, as well as the Development Bankof Japan, leading life insurers and trust banks.

A handful of smaller regional banks had been hesitant toroll over Tepco's October loan as they tried to distancethemselves from a utility that has come under renewed publiccriticism over its handling of contaminated water at Fukushima.Those banks were eventually won over by the firm's applicationto restart the Kashiwazaki Kariwa facility.

After months of denials, Tepco admitted in July thathundreds of tonnes of contaminated water is flowing into thePacific Ocean every day. Last month, Tepco said 300 tonnes ofwater with dangerous levels of radiation had leaked from astorage tank at the Fukushima plant.

Japan has pledged half a billion dollars to deal withcontaminated water at the site, and Prime Minister Shinzo Abehas promised the government will take a prominent role in theclean-up.

Tepco shares climbed as much as 2.7 percent on Monday,reversing earlier losses. By the midsession, the stock was up 1.5 percent at 606 yen, while the benchmark Nikkei index was down 1.7 percent. Tepco was the most traded stock byturnover.

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