Digicel extends early tender deadline for 2020, 2022 exchange offers

By Marisa Wong

Morgantown, W.Va., Sept. 7 – Digicel Group Ltd. announced it extended the early tender date for its previously announced exchange offers to 11:59 p.m. ET on Sept. 28 from 5 p.m. ET on Sept. 14.

According to a Friday press release, the company has also entered into “constructive” discussions with an ad hoc group of noteholders regarding the exchange offers and related consent solicitations.

Digicel began the offers on Aug. 31 to exchange any all of its outstanding $2 billion 8¼% notes due 2020 and any and all of its outstanding $1 billion 7 1/8% notes due 2022 for new notes to be issued by its subsidiaries.

Digicel is offering to exchange the existing 8¼% notes due 2020 for up to $2 billion of new 8¼% notes due 2022 to be issued by indirect subsidiary Digicel Group One Ltd. and the existing 7 1/8% notes due 2022 for up to $1 billion of new 8¼% senior cash pay/payment-in-kind notes due 2024 to be issued by direct subsidiary Digicel Group Two Ltd., the parent of Digicel Group One. Cash interest on the new 2024 notes will accrue at a rate of 7 1/8%, and PIK interest will accrue at a rate of 1 1/8%.

The early tender date now coincides with the expiration of the exchange offers. The withdrawal deadline for each offer has also been extended to 11:59 p.m. ET on Sept. 28.

For each $1,000 principal amount of existing notes tendered by the early tender date, holders will be eligible to receive $1,000 principal amount of new notes. The total exchange consideration includes an early tender premium of $50 principal amount of new notes.

Originally, holders tendering after the early tender date would only have been eligible to receive the tender offer consideration of $950 principal amount of new notes.

Digicel is also soliciting consents from holders of the existing notes to adopt some proposed amendments to the respective indentures. The proposed amendments would eliminate substantially all of the restrictive covenants and events of default contained in each existing indenture.

Adoption of the proposed changes requires consents from holders of a majority of the outstanding principal amount of the applicable series of existing notes.

Each exchange offer is conditioned on at least 90% of the principal amount of the applicable series being tendered, receipt of the necessary consents to amend that series and completion of the other exchange offer.

Holders may not deliver consents without tendering their notes.

The company had said the purpose of the exchange offers is to extend the maturity date of its near-term maturities.

Global Bondholder Services Corp. (866 470-3800, 212 430-3774, contact@gbsc-usa.com) is the exchange agent and information agent for the Rule 144A and Regulation S exchange offers and consent solicitations.

Digicel is a mobile phone network provider based in Kingston, Jamaica.

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