Irish incumbent Eircom is reportedly offering its first lien lenders a 20% stake, in a move that would allow its shareholders to retain control of the former monopoly.
The deal includes approximately E300m in cash payments, reported the Irish…
Irish incumbent Eircom is reportedly offering its first lien lenders a 20% stake, in a move that would allow its shareholders to retain control of the former monopoly.
The deal includes approximately E300m in cash payments, reported the Irish Independent citing sources close to the situation.
Eircom’s first lien lenders, which represent E2.6bn of outstanding debt and are advised by Houlihan Lokey, are considering the offer, but other lenders owed E1.3bn would lose everything under the plan, the report added. Eircom’s second lien creditors are thought to be advised by Moelis.
Investment group Singapore Technologies Telemedia (STT), which owns two-thirds of the operator, and employee shareholder trust ESOT, which owns the rest, reportedly back the deal but were unable to comment.
Eircom, which is itself advised by Gleacher Shacklock and JP Morgan, declined to comment.
On 15 September, the group announced it had received a waiver from senior lenders over covenant breaches to avoid defaulting on its debt.
JP Morgan acted as agent and security trustee to temporarily waive the breach of senior debt/EBITDA covenant as at 30 June 2011 until 15 December 2011.
The company’ Q3 2011 revenue for the three months to the end of March was E407m, an 11% decrease compared with the corresponding period last year. It posted Q3 2011 adjusted EBITDA at E160m, down E10m on last year.
