Creditors of the Bulgarian Telecommunications Company (Vivacom) have agreed to sell 93.99% of the company to two investors in a deal worth up to €617m.
Under the terms of the proposed transaction, subject to regulatory approval, the investors will…
Creditors of the Bulgarian Telecommunications Company (Vivacom) have agreed to sell 93.99% of the company to two investors in a deal worth up to €617m.
Under the terms of the proposed transaction, subject to regulatory approval, the investors will pay the company’s senior secured lenders €130m for a majority of the equity and take on €588m in loans, according to a Vivacom statement referencing a notification from the Royal Bank of Scotland, which is acting as coordinator for the lenders’ steering committee.
The senior secured lenders will retain a minority of the equity and have the option to cash in their loans when the transaction closes, the statement read. If this option is fully exercised, the total deal value will equate to €617m.
The acquisition price per share will depend upon the lenders’ uptake of the cash exit option.
The transaction is expected to close in September. As required under Bulgarian law, the new majority shareholders will launch a tender offer for the remaining shares.
While the names of the new owners where not disclosed by Vivacom, it is known that Bulgaria’s Corporate Commercial Bank (CCBank) and Russian VTB Bank had submitted a joint bid in an earlier sale attempt that was called of in May. Reports appearing on Friday afternoon said CCBank had confirmed the purchase. VTB Bank declined to comment.
Vivacom’s creditors mandated Morgan Stanley last year to sell the company after it breached loan conditions, but the process was cancelled when bids submitted did not meet seller’s expectations.
