Philippine operator Globe Telecom has received court approval to restructure Bayan Telecommunications’ (Bayantel) debt and convert it into equity.
The struggling local fixed-line operator will see its liabilities reduced from US$423.3m to US$131.3m…
Philippine operator Globe Telecom has received court approval to restructure Bayan Telecommunications’ (Bayantel) debt and convert it into equity.
The struggling local fixed-line operator will see its liabilities reduced from US$423.3m to US$131.3m following the conversion of up to 69% of its debt load into shares, according to a stock exchange announcement.
As the company’s largest creditor, Globe will initially convert some of its debt holdings into 38.3% of Bayantel’s equity. Ultimately, and following further regulatory and corporate approvals including from current equity owner Lopez Group, Globe is expecting to hold 56.6% of the fixed-line operator’s capital stock.
At the end of last year, Globe announced the completion of its tender offer to purchase 96.5% of Bayantel’s debt.
Speaking to TelecomFinance about the rationale behind the deal a few months ago, Globe CFO Albert de Larrazabal described Bayantel as “a good synergy for our business, a nice bolt-on”, because of its infrastructure assets in areas where Globe does not have any, as well as its spectrum in the 1800 MHz band to be used for LTE.
