THE crisis at debt-crushed Eurotunnel deepened as bosses squabbled over the best way to avert bankruptcy.

Chief executive Jean-Louis Raymond quit after a row with company chairman Jacques Gounon, but stayed on as a non-executive director.

Mr Gounon – now also chief executive – had urged creditor banks to waive up to two-thirds of the £6.4billion debt hanging over the Channel Tunnel operator.

It has already announced 450 job losses, 200 in Cheriton, Folkestone and 250 in Coquelles, Calais, out of a total workforce of 3,200.

It insists they will all be achieved through natural wastage and voluntary redundancy, and promises a substantial extra pay-off, thought to be around £19,000.

Mr Gounon criticised the deal, negotiated by Mr Raymond, in French newspaper La Voix du Nord.

At what is certain to be a stormy annual meeting in a Calais sports hall, Mr Raymond is challenging Mr Gounon for his position.

French shareholders, buoyed by their success in ousting the previous mainly British board, led by Canterbury-based chief executive Richard Shirrefs, at last year’s meeting, expect to influence proceedings once again.

Mr Raymond said after his shock resignation: "Yesterday I signed an agreement with unions and staff representatives after several months of negotiations.

"The fact that the President has chosen to voice publicly his criticism of such an important agreement is quite unacceptable, can only be against the company’s interests and has forced me to draw my own conclusions."

He said he would explain his actions at the meeting in Calais next week.

Meanwhile, Mr Gounon told the BBC’s Money Programme that Eurotunnel will go bust if creditors and shareholders object to his plan.

It would be a political disaster, he said, and would jeopardise future infrastructure projects funded by private investment. And it would be bad for customers who are enjoying low fares sparked by intense competition from ferries.

"It’s clear the turmoil which will be created by such solutions will strongly impact the customer and the prices to cross the Channel will jump, that’s obvious."

Maverick investor Nicholas Miguet said that shareholders would take the bricks if the company is not turned around.

Eurotunnel, opened in May 1994, has been hit recently by fierce price competition from ferries and low-cost airlines. It has been forced to slash fares to encourage more business.

Business was also affected by the scrapping of duty free, and it faces a new problem late next year when it loses guaranteed income from Eurostar, the high speed train operator.