Rolta India’s restructuring ends after company fails to meet terms

New York, April 23 – Rolta India Ltd. said that an ad hoc committee of senior noteholders terminated the agreement to restructure the company’s debt after the company failed to meet its obligations.

Further developments will be disclosed in “due course,” Rolta India said in an announcement.

Under the terms of the restructuring support agreement signed with the noteholders, the company had been required to start a solicitation for a pre-packaged Chapter 11 filing and deposit fees into an escrow account by April 20.

Rolta India said it had not met those requirements and as a result the noteholders terminated the agreement.

The company announced the agreement on Feb. 13 and then amended it on April 1 to extend the deadline to begin the solicitation and accelerate the date for paying fees.

As agreed with the noteholders, Rolta India had been proposing to restructure its $300 million of 8 7/8% senior notes due 2019 and $200 million of 10¾% senior notes due 2018 through a pre-packaged Chapter 11 plan.

Solicitation for the plan had been intended to begin by April 9, subsequently extended to April 20.

Under the proposed restructuring, amounts owed under the senior notes would have been restructured and exchanged for $50 million of upfront cash, less professional, legal and forbearance and consent fees, as well as $270 million of new 4% PIK unsecured notes due 2019 that can be redeemed in full before maturity for $100 million and $230 million of new 4% unsecured notes due 2023 that can redeemed in full before one year for $113 million or within two years for $156 million, excluding interest, which needs to be repaid at par.

Interest on the new notes would have begun accruing from April 30.

In addition to the one-year and two-year redemption rights, the group would have had the right to redeem the notes in full via payment of an additional $150.5 million within 30 days of the restructuring effective date.

Forbearance and/or consent fees would have been paid to senior noteholders that accede to the support agreement and/or vote in favor of the restructuring.

Rolta India is a technology services company based in Mumbai.

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