Digicel also said that various classes of bondholders had agreed by overwhelming majorities to grant certain waivers that would allow it proceed with a possible avenue to copperfasten the restructuring without triggering a default event. The restructuring route that Digicel may take is a so-called scheme of arrangement, which is a court-approved arrangement between a company and creditors.
Majorities of between 78 per cent and 91 per cent of the relevant bond categories have given consent, according to the company.Listen |The broad outline of the restructuring being finalised was agreed with major groups of creditors at the end of February. It will mean holders of the bonds that were due last month and a category of subordinated bondholders swap their $1.8 billion debt investment for an initial 90 per cent equity stake in the business.Mr O’Brien’s stake will fall to 10 per cent as a result, though he may see his holding increase again to as much as 20 per cent, should warrants attached as an incentive to the restructuring end up being exercised.
The overhaul will also involve two other categories of bondholders writing off most of their combined $640 million investment. Founded by Mr O’Brien in 2001, Digicel has spent €5 billion over more than two decades building out mobile and other telecoms networks across as many as 33 markets, funded mainly by junk bond sales. Mr O’Brien also extracted at least $1.9 billion of dividends from the group between 2007 and 2015.
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