| 7.5°C Dublin

Digicel wins €250m from Orange in Paris court ruling


Award: Digicel boss Denis O’Brien in Port au Prince, Haiti

Award: Digicel boss Denis O’Brien in Port au Prince, Haiti

Award: Digicel boss Denis O’Brien in Port au Prince, Haiti

Denis O'Brien's Digicel has been awarded nearly €250m by a French court.

Rival telco Orange has been ordered to compensate Digicel for anti-competitive practices in the French Caribbean.

The Paris Appeals Court ruled this week that Orange must pay Digicel €181.5m in damages and €68m in interest.

Digicel said it will split the award equally with Bouygues Telecom, the company it bought the French Caribbean business from back in 2006.

"The award reflects the level and duration of anti- competitive practices engaged in by Orange in the French West Indies over many years, much of this pre-dating the sale by Bouygues Telecoms of its French West Indies business to Digicel in 2006," Digicel said.

Orange can still appeal in France's highest court but if the award stands it is the second financial boost for Digicel in days.

On Thursday, Digicel confirmed a scheme of arrangement securing agreement from bondholders to slash debt by $1.6bn (€1.42bn) is now effective.

Digicel's debt interest costs will be cut by approximately $125m a year as a result of the deal struck with lenders.

The process will see lenders surrender billions of bonds back to the company and swap them for a smaller amount of new debt. That is likely to happen next week.

The company said the scheme of arrangement marks the conclusion of the last significant milestone in its debt reduction process, which is expected to be complete next week.

The O'Brien-owned telecoms group secured support from most of its lenders for the process, after arguing its debt pile of around $7bn was not sustainable.

In exchange for lenders' support, Mr O'Brien will contribute $50m of assets and retain control of his telecoms empire.

Holders of one class of $925m of bonds due in 2023 did not back the plan, and their bonds are not affected.

Digicel operates in 32 markets in the Caribbean, Central America and Asia Pacific.

The legal scheme was sanctioned by the Bermuda Supreme Court on June 8 and recognised in the United States through a court process on June 17.

Mr O'Brien said the agreement with bondholders will allow the group to further enhance services across its 32 markets, where it has invested $2.2bn over the past five years.

"Our journey and investment encompassed a wide range of emerging markets, some of which had little or no telecommunications infrastructure prior to Digicel commencing operations," he said.

Irish Independent