Creditors of Bulgarian telco Vivacom are set to meet in the English High Court on 30 August to discuss the planned takeover by Russia’s VTB Capital and the Bulgarian Corporate Commercial Bank.
Vivacom announced in mid July that the parties had agreed…
Creditors of Bulgarian telco Vivacom are set to meet in the English High Court on 30 August to discuss the planned takeover by Russia’s VTB Capital and the Bulgarian Corporate Commercial Bank.
Vivacom announced in mid July that the parties had agreed a restructuring deal and last week, the company said they had entered into a lock-up agreement.
If approved, the creditors’ proposed scheme of arrangement “will give a effect to a comprehensive restructuring of BTC and the rest of the Vivacom group that will see VTB/CCB acquire a majority equity stake in the restructured group”, the company said in a statement today.
Creditors hope the restructuring deal will be approved at a second court hearing, expected to take place on 6 September.
The proposed restructuring will see VTB and CCB pay €130m to the senior secured lenders for a 73% stake in Vivacom, with creditors retaining a 21% shareholding. The remaining 6% held my minority shareholders will be floated on the Bulgarian Stock Exchange. Proceeds will be used to help repay about €1.7bn in debt.
“This proposal assumes a reduction in total leverage … to approximately €588m through debt repayment, equity conversion and an outright debt right-off,” the company said.
Lenders will also have the option to sell their positions and, if all creditors decided to do so, the acquirers would pay €617m in total.
The deal, subject to regulatory approval, is expected to close in this year’s fourth quarter.
