Friday 20 September 2019

Digicel bondholders agree to two year extension

Digicel ambassador Usain Bolt
Digicel ambassador Usain Bolt Business Desk Business Desk

Digicel has received overwhelming bondholder acceptance for its offer to swap $2bn of bonds originally due to mature in 2020 for new secured bonds maturing in 2022.

The exchange offer was backed by holders of 94.7pc of the 2020 debt.

Holders of a second class of bonds due in 2022 have until midnight (New York time) December 21 to accept a similar proposal.

Taken together Denis O’Brien's telecommunications group is looking to bondholders to swap $3bn (€2.59bn) of outstanding debt for new securities with later maturity dates.

The agreement to push back bond maturities will provide financial breathing space to the company before it needs to repay the debt.

Under the swap offer, bonds with an 8.25pc interest rate due in 2020 will be swapped for new bonds due in 2022, also with an 8.25pc interest rate.

Another class of bonds, due in 2022 and with a 7.125pc interest rate, would be swapped for new bonds due in 2024, with an 8.25pc interest rate. Cash interest on the new bond would be 7.125pc and payment-in-kind interest (interest rolled up as new debt) would be 1.125pc.

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