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Digicel debt scheme bound for court approval

Published:Sunday 12:07 AM

Digicel founder Denis O’Brien

Digicel Group and its affiliates have started the legal process to reorganise the company and reduce the control of founder Denis O’Brien, new market filings show.

The debt conversation transaction will result in nearly two-thirds of the voting rights in Digicel ending up in the hands of two investment managers; PGIM Inc will hold 48.4 per cent and Contrarian Capital 16.2 per cent, the documents indicate.

The precise holdings that O’Brien will be left with were not stated.

The Irish billionaire’s majority ownership in the telecoms was ultimately held by Digicel Group Holdings Limited. Under the debt swap agreement, that control will shift to Digicel Holdings (Bermuda) Limited, “which will be the ultimate indirect parent of holdings immediately after giving effect to the reorganization transactions,” said the filing to the US Securities and Exchange Commission.

Digicel is seeking approval of the court in Bermuda for the new scheme of arrangement, and expects the hearings to happen on or about November 10.

The reorganisation and debt swap are expected to shave one-third of Digicel Group’s debt load to from US$4.5 billion to US$3 billion.

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