The Hungarian government is throwing a lifeline to one of eastern Europe’s biggest private-equity deals by offering a €100m ($142m) loan to Borsodchem, the chemicals group acquired by UK buy-out house Permira for €1.6bn in 2006.

The loan from the state-owned Hungarian Development Bank is conditional on Permira reaching an agreement with Borsodchem’s lenders to restructure its excessive debt in a way that is acceptable to Budapest.