Digicel Bermuda files for Ch15 bankruptcy protection

Cayman Marl Road reports, via Bloomberg News, that Digicel’s Bermuda unit has filed for chapter 15 bankruptcy protection in New York,

The move will buy time for the Irish telecommunications company to implement a previously announced plan to restructure its operations to reduce a reported debt of US$7.4 billion.

The company has also implemented company wide salary reductions to reduce its debt burden.

Digicel issued a statement today which noted, in part, that…

At the start of April, we announced refinancing activities which, when complete, will strengthen our balance sheet by reducing our debt, extending our maturities and reducing our ongoing financing costs.

Following overwhelming support from our debtholders for these proposals, we are now progressing with the required administrative processes.

As such, we announced details of a proposed Scheme of Arrangement in the Bermudian Courts in connection with Digicel Group One Limited, which is purely an intermediate financing holding company.

This Scheme has the support of over 97% of its bondholders and also involves the appointment of a light touch joint provisional liquidators to oversee the implementation of the Scheme.

Read the full report here.