Shares in Elan came under renewed pressure yesterday as the market prepared for another delay in the filing of the company's accounts with the US Securities & Exchange Commission (SEC).
Elan missed its fifth deadline for the filing last Friday when the company's bondholders allowed it one more week to present the accounts.
That reprieve, which cost Elan $2.1 million (€1.9 million), will expire at close of business today.
If the company has not filed its accounts by then, it will need to secure another extension from the holders of $840 million of its EPIL bonds or face defaulting on debt of up to $2 billion.
Elan did not offer any update on the situation yesterday but the company is likely to make a statement on the matter today.
A spokeswoman was unavailable for comment last night but it is thought that discussions with the company's auditors, KPMG, over the 20-F filing were continuing.
KPMG's reluctance to sign off on the books was the main reason for last week's extension.
The company's shares suffered amid the general uncertainty, closing 25 cents lower at €3.90 in Dublin and continued to drift in New York before closing at $4.33, down two cents.
Analysts declined to speculate on Elan's intentions yesterday but warned that, if a further extension were granted, it could cost more money than last week.
They also say that another delay will only increase investors' growing nervousness about Elan's future.
The firm had originally been due to file the accounts on June 30th but has won repeated reprieves, both from the SEC and the debt-holders.
In theory, the position of the EPIL-holders becomes stronger each time they agree to a delay on the presentation of the 20-F, as long as Elan makes the filing before September 14th.
On that date, a continuing failure to file would leave Elan in default to the holders of senior debt worth $650 million, who rank above the EPIL-holders.
The holders of this debt are thought unlikely to be so understanding as those in other categories.
If they called in their debt, Elan would face a crippling cash crunch and the company's survival would be in question.
It is believed that the discussions between KPMG and Elan centre on the proposed restatement of the pharmaceutical firm's 2001 accounts.
Elan has flagged this restatement, relating it to the consolidation of an off-balance-sheet vehicle.
