Cell C makes progress in slashing R7.3bn debt
Debt-saddled mobile operator Cell C has made significant progress in efforts to slash its R7.3 billion debt.
This, after the telco this afternoon announced Cell C’s secured lenders, who formerly held publicly-listed bonds or notes, have voted with the requisite quorum and majority in favour of the compromise cash-out offer of 20c for every R1 of debt.
This marks a critical milestone in the financial restructuring and recapitalisation of the mobile operator, says Cell C in a statement.
The company has been waiting for recapitalisation for some time.
The latest development comes after Blue Label Telecoms, Cell C’s biggest shareholder, in May notified shareholders that bond-holders will be required to legally indicate their consent to the offer – of 20c for every R1 of debt – by means of a vote.
It said a majority of at least 75% of the vote in favour of the offer was necessary for it to be implemented.
In today’s statement, Cell C says the listed notes ($184 002 000) are a portion of Cell C’s overall debt of R7.3 billion owed to secured lenders.
Says Douglas Craigie Stevenson, Cell C CEO: “This is a significant step in the overall process to deleverage Cell C’s balance sheet. It shows confidence in our new business strategy and with the overall debt reduced and simplified; we are set to compete as a sustainable entity going forward.”
The final steps to concluding the overall transaction involve the signing of conditions precedent and long-form agreements and this is expected to be concluded in a matter of weeks, Cell C concludes.