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COLT Telecom solicits consents for 7 5/8% notes due 2009
By Jennifer Chiou
New York, Sept. 25 - COLT Telecom Group Ltd. said it began a consent solicitation for its 7 5/8% senior notes due 2009.
The company said it will pay £1.50 per £1,000 principal amount of notes to consenting noteholders.
The London-based provider of data, voice and managed services is seeking consents to an amendment to the note indenture to allow it to changes reflecting its new corporate structure, specifically permitting it to substitute COLT Telecom Group SA in most of the covenants.
The changes would make most of the covenants in the note indenture applicable to COLT Telecom Group Ltd. and its subsidiaries rather than only COLT Telecom Group Ltd. Subsidiaries of COLT Telecom Group SA would become restricted subsidiaries.
In a corporate reorganization this year, COLT Telecom Group SA became the indirect holding company of COLT Telecom Group Ltd., whose shareholders became shareholders in COLT Telecom Group SA.
COLT Telecom Group SA and its subsidiaries raised £300 million of new equity to make loans to the COLT Telecom Group Ltd.
The company is also looking to amend the covenant limiting restricted payments to add an additional £30 million general "basket" carve-out from the prohibition on restricted payments.
The company added it will only be able to amend and supplement the indenture if COLT Telecom Group SA has a consolidated leverage ratio on a pro forma basis less than or equal to the consolidated leverage ratio of the COLT Telecom Group Ltd. immediately prior to the covenant transfer.
The tabulation agent is The Bank of New York. The solicitation agent is Deutsche Bank AG, London Branch (44 207 545 8011).
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