Globe Telecom and Bayan Telecommunications Holdings Corp. on Thursday jointly filed a motion with the rehabilitation court to convert Bayantel’s debt into equity.
In a disclosure to the Philippine Stocks Exchange, Globe said that, “Further to the disclosure made by Globe Telecom Inc. on April 18, 2013, Globe said that the motion seeks to significantly restructure Bayantel’s financial debt in order to prevent the recurrence of default and ensure Bayantel’s continued viability.”
Following Globe’s tender offers for the Bayantel debt in 2012, the Ayala-led telecommunication firm currently holds approximately 96.5 percent of the total financial indebtedness of Bayantel.
The joint motion aims to achieve a successful rehabilitation of Bayantel at the earliest possible date.
The current outstanding principal amount of this debt is approximately $423.3 million. As restructured, the outstanding principal debt balance would be reduced to approximately $131.3 million, assuming the debt to equity conversions occur to their fullest extent.
On the part of Bayantel, a restructuring of its debt and the entry of Globe as a shareholder as well as creditor will enable Bayantel to unlock and maximize potential of its key business assets and capabilities, and help accelerate its rehabilitation.