An Irish court has rejected Hong Kong-based conglomerate Hutchison Whampoa’s legal proceedings against the firm overseeing incumbent Eircom’s restructuring.
Hutchison had launched legal action after Grant Thornton, Eircom’s court appointed…
An Irish court has rejected Hong Kong-based conglomerate Hutchison Whampoa’s legal proceedings against the firm overseeing incumbent Eircom’s restructuring.
Hutchison had launched legal action after Grant Thornton, Eircom’s court appointed Examiner, rejected its revised €2bn cash offer last week.
Supported by holders of Eircom’s €350m floating rate loan notes (FRNs), Hutchison’s call for due consideration of its offer had risked disrupting the operator’s long-running restructuring process.
Tomorrow’s meeting with creditors is now expected to go ahead as planned to finalise a scheme of arrangement, recommended by Grant Thornton, which was previously put forward by Eircom’s first lien lenders. This plan is thought to see first lien lenders reduce the €2.7bn they are owed by 15%, with second-lien lenders receiving only 10% of their €350m debt, in return for equity.
However, the move would also wipe out subordinated debt, comprising €350m in FRN notes and €700m held by PIK lenders. It is understood that Hutchison’s takeover proposal had included a €50m payment for FRN holders.
MOP LLP is Hutchison’s legal adviser, and Cadwalader, Wickersham & Taft LLP is advising the FRN lenders.
Neither party was able to comment before the press deadline.
