Key Points:

Prime Minister John Key has told Parliament that struggling whiteware Fisher & Paykel has not been given any assurance it won't be allowed to fail.

Key was asked by Opposition leader Phil Goff to outline what criteria might be used by Government when looking at bailing out other companies.

He said there would be a "very high benchmark" and the preference would be for companies to use more classical banking sources.

Key said that if any such bailout happened, there would be conditions placed around them to ensure New Zealand jobs were protected.

F & P told investors on Monday that it was in talks with a number of parties in a bid to raise capital to help with its burgeoning debt levels.

The company's debt is expected to hit $570 million by the end of March - a debt to debt-plus-equity ratio of 43 per cent - as a result of a fall in the New Zealand dollar and a drop in sales.

The company's share price plummeted 35 per cent to 65c on the news but yesterday bounced back 7c to close at 72c after the Government said it would not rule out a bailout of the business.

Today its share price has continued to slump, falling 11 per cent on the NZX, an 8 cent fall to 64 cents.

Fisher & Paykel has not asked the Government for help and is pushing on with plans to find a major investor and raise capital from existing shareholders.

Key has been careful to rule out any wide-scale corporate rescues, saying any Government involvement would be in isolated cases and "the benchmark is pretty high".

But he said the Government was also working on options for other big companies which might be affected.

National has previously mentioned contingency plans to help important companies facing collapse, but F&P Appliances is the first individual firm to be mentioned.

Key said it remained profitable, had other options to explore and had not sought Government help.

"But it's an iconic NZ company that employs 1600 people," he said.

HERALD ONLINE