They will be seen in the City as a first step on the road towards closer integration of the Rothschild banks around the world.Baron de Rothschild, 53, is the talented French banker who resurrected the banking fortunes of the Rothschilds in Paris after the family’s French bank was nationalised in 1981He became deputy chairman of NM Rothschild, the London merchant bank, in 1992. The Rothschilds are planning a big reorganisation that will lead to closer co-ordination of the banking dynasty’s world-wide businesses. A new group investment banking committee, chaired by Baron David de Rothschild, is to co-ordinate the family’s corporate finance businesses in London, Paris, the rest of continental Europe, Hong Kong, Singapore, Australia, North America and Latin America.
The expected changes are part of a long awaited management shake-up to deal with increasing competitive pressures in the investment banking industry. The debt standstill runs until April of next year but all sides appear to accept that unless agreement on rescheduling can be reached by the end of this month, then the courts will have to step in.. Since then it has racked up another pounds 370m of interest which has not yet been paid.

What remains to be agreed is the precise amount of debt that will be exchanged and the price at which the bonds convert to shares.Conversion of the bonds would give the banks control of the company but Eurotunnel is holding out for an option to redeem the bonds should it meet certain revenue targets, allowing it to prevent further dilution of its existing shareholders.The Anglo-French consortium suspended interest payments on most of its pounds 8bn of debts a year ago. Three weeks ago Sir Alastair Morton, who retires as co-chairman of Eurotunnel at the end of October, said the “architecture” of an agreement was in place. He said there were about eight hours of negotiations left, which was why he had given himself another eight weeks to complete them.Since then talks are understood to have progressed quicker than expected. One observer said the two sides were “five eighths of the way down the track”.The two French agent banks are said to have been keen to reach an agreement before the mandate of the two mediators expired.

But the British representatives are understood to have baulked at the terms.Under the rescheduling deal, the banks will swap part of their debt for a 49 per cent stake in Eurotunnel and exchange a further portion for convertible bonds. This comprises its four agent banks – NatWest, Midland, Credit Lyonnais and Banque National de Paris – the European Investment Bank and the European Coal and Steel Community.On Friday, the Eurotunnel board will meet, as will its key 25-strong committee of instructing banks who represent the views of the rest of the banking syndicate.Sources suggested last night that this could pave the way for an announcement at the beginning of next week.”The chances of a deal being done finally are better than even,” one said. But observers believe it is more likely to give the two sides a short period – perhaps 10 to 14 days – to reach a final agreement.The weekend talks, held on what was described as “neutral territory” in London, involved Eurotunnel and the bank steering group. An announcement from the court is expected in the next two days.The court has the authority to begin proceedings to place Eurotunnel in protective administration if there is no agreement.