Irish incumbent Eircom is on the verge of announcing whether the group’s lenders have granted it another waiver on its debt covenants, which are due to expire today.
At the time of going to press, senior lenders were voting once again whether to…
Irish incumbent Eircom is on the verge of announcing whether the group’s lenders have granted it another waiver on its debt covenants, which are due to expire today.
At the time of going to press, senior lenders were voting once again whether to extend the deadline for a breach of Eircom’s banking covenants, which had been pushed back from September 2011.
Eircom announced earlier this week that it had received a proposal from Singapore Technologies Telemedia (STT), its largest shareholder with a 65% stake, to support the restructure of €3.75bn (US$5.1bn) of debt.
An Eircom spokesman declined to disclose details of the proposal, but local reports suggest STT plans to inject €200m in a move that would involve first-lien lenders taking a 25% haircut on their €2.4bn of debt.
Previous reports suggest STT had planned to stump up €300m with a debt write down of 8%. However, in the wake of the eurozone crisis, it is also reportedly adding a clause to its new proposal that would see it getting refunded if Ireland leaves the euro before 31 March 2013.
STT was unable to comment before the press deadline.
In Eircom’s latest trading update, the group said that employee share trust ESOT, which has the remaining 35% stake in the group, “is committed to further constructive discussions with regard to their participation in the STT proposal”.
The Irish firm said it had received proposals from its first and second lien lenders earlier in December, and its independent directors were still considering them alongside the STT proposal.
Gleacher Shacklock and JP Morgan are advising Eircom on its debt restructuring, with Houlihan Lokey advising its first lien lenders. Moelis is thought to be advising the second lien debtors.
