Binding offers for troubled Greek mobile operator Wind Hellas are due tomorrow at the close of the business day, with no clear frontrunners emerging.
The reported bidders are Telenor, US private equity firm Saban Capital, Wind majority shareholder…
Binding offers for troubled Greek mobile operator Wind Hellas are due tomorrow at the close of the business day, with no clear frontrunners emerging.
The reported bidders are Telenor, US private equity firm Saban Capital, Wind majority shareholder Weather Investments, a group of Wind’s senior bondholders and Greek companies On Telecoms and Info-Quest.
Telenor is advised by Citigroup and Orrick, Herrington & Sutcliffe, TelecomFinance understands. Telenor’s interest in the auction stems from its former ownership of Greek mobile operator Cosmote. Having bought a 22% stake in the operator in 1997, it then gradually reduced its holding before exiting completely in 2004.
Morgan Stanley and White & Case are running the sale.
One source close to the company suggested that the bondholders may be deterred by the fact that they would need to invest some E450-500m – comprising the E250m revolving credit facility Wind Hellas has to pay plus the equity investment.
However, another source familiar with the negotiations believed the bondholders did have the capacity to support such an investment.
The senior secured bondholder group reportedly comprises Anchorage Advisors, Angelo Gordon, Eton Park, Mount Kellet and Taconic Capital. There have been allegations that the E1.2bn valuation of outstanding senior secured bonds – which the market has discounted to 30-40% of face value – is greater than the company’s current enterprise value. The company has a further E355m in outstanding senior unsecured bonds as well as a E250m revolving credit facility.
In late 2009, Wind Hellas’s parent Weather Investments managed at the eleventh hour to restructure E3.2bn of company debt and inject E125m of fresh equity into the business, simultaneously writing off all junior debt, including E960m and US$275m of subordinated bonds as well as E200m of PIK notes.
Junior bondholders had responded with a renewed rival bid to takeover the company in an effort to protect their existing investments, which total E1.2bn.
Subordinated bondholders, led by Aladdin Capital, had claimed that their offer for Wind Hellas – including E200m of unconditional funding – was “economically superior in all respects to the current Weather bid for all classes of creditorsW.
However, at that stage Wind Hellas remained highly leveraged at about 5.8x 2009’s projected EBITDA of E320m. There was also E1.2bn of debt to be refinanced by 2012.
