T&T: Digicel completes restructuring exercise

PORT OF SPAIN, Trinidad, CMC – The telecommunication company, Digicel, Monday announced that its US$1.7 billion restructuring exercise had been completed and that a consortium had secured a controlling stake in the company.

The consortium is led by PGIM, Contrarian Capital Management and GoldenTree Asset Management and two investment managers will own nearly two-thirds of Digicel’s voting rights. According to the documents, Contrarian Capital will control 16.2 per cent and PGIM Inc. 48.4 percent. GoldenTree Asset Management, a private equity fund, will also have an unidentified position.

Gregory Cass, the principal of PGIM, Pat Dyson, the partner of GoldenTree, and Xiao Song, the managing director, oversee Contrarian Capital Management.

According to Digicel founder and outgoing chairman, Denis O’Brien, “the restructuring of Digicel has been completed today.

“It’s been nearly an 18-month process and we are delighted now that the business has been completely restructured and it puts Digicel in a very, very strong position financially,” said O’Brien, who will be replaced by the 56-year-old Rajeev Suri, an Indian born Singaporean business executive, who has been the chief executive officer of Inmarsat since February 2021.

O’Brian, who will assume the position of non-executive position on the board, told the Trinidad Express newspaper that the restructuring meant “that the business has removed a lot of debt, and a lot of the debt has been equitised as well, so it just puts the business on a very sound footing and also for investment in the future as well”.

O’Brien, who is attending Canto Connect and 40th annual general meeting,  said he does not expect any impact on Digicel operations in the Caribbean, saying “it is business as usual. It has always been business as usual here in Trinidad and throughout the region as well. It really has not impacted the business in any way,” he said.

“We are adding new customers, adding new clients building new fiber networks to homes and businesses across the region so the future is very bright for Digicel,” O’Brien said.

He told the newspaper that “as the founder I am really proud of what has been achieved by everybody working for Digicel but also to thank our customers as well and I will then take a non-executive seat at the board.

Earlier this month, Legal documentation released by the Digicel Group and its affiliates showed that the transfer of majority ownership had to be completed by month end.

O’Brien had submitted several additional papers to the US Securities and Exchange Commission about the debt-conversion plan, which calls for him to cede primary ownership and control of the telecom company, which was founded in Jamaica and is headquartered in Kingston.

Digicel’s borrowings will drop from US$4.7 billion to about US$3 billion because of the debt conversion deal. Digicel used debt primarily to fund its operations as it grew throughout the Caribbean, Central America, and the Pacific. But the creditors were forced to restructure the company because of its inability to make bond payments.

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