Il default non c'è ancora stato, ma il distressed exchange proposto sul debito di Bité dovrebbe risolversi nell'assegnazione in prima battuta di un rating SD sull'emittente e D sul titolo.
Qualcuno ricorderà che la telecom lituana era stata oggetto di cessione da parte degli acquirenti di TDC ad un altro gruppo di equity firms, ed acquisita ancora con la formula del LBO, ponendo così sulle spalle della telecom lituana un debito decisamente consistente, rivelatosi poi insostenibile a seguito del recente crollo delle economie baltiche.
Ai titolari del bond subordinato ai quali è rivolto il concambio non va cmq così male, giacché gli vengono offerti in cash 38,5/100.
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UAB Bité Lietuva Ratings Lowered To 'CC' On Notes Exchange Offering; Outlook Negative[/FONT]
LONDON (Standard & Poor's) Feb. 18, 2009--Standard & Poor's Ratings Services said today it lowered to 'CC' from 'CCC-' its long-term corporate credit rating on Lithuania-headquartered mobile telecommunications operator UAB Bité Lietuva (Bité) and its 100% owner Bité Finance International B.V. The outlook is negative.
At the same time, we lowered the rating on Bité Finance International
B.V.'s €190 million senior secured notes to 'CC' from 'CCC-' and affirmed the 'C' rating on the €110 million subordinated notes.
The downgrade reflects today's €38.5 million below par notes exchange offering by the company for the €110 million notes. The offer will be financed through the provision of additional equity from the group's current shareholders led by Mid Europa Partners.
"Standard & Poor's views the exchange offer as distressed because the exchange value offered is well below par (35 euro cents on the euro) and the noteholders do not have a realistic alternative to be repaid in full," said Standard & Poor's credit analyst Helen O'Toole. (For further details see the article entitled "Rating Implications Of Exchange Offers And Similar Restructurings," published on RatingsDirect on Jan. 28, 2009).
"We will lower the corporate credit rating on Bité to 'SD' (selective default) and the affected issue rating to 'D' upon completion of the exchange offer. At the same time, the rating on the senior secured notes is likely to remain at 'CC', assuming adequate continuing servicing," said Ms. O'Toole.
"If the exchange offer is successful, Standard & Poor's believes Bité is
likely to initially extinguish a maximum of €50 million of its subordinated
debt," said Ms. O'Toole. According to the documentation of Bité's senior
revolving credit facility (RCF), if more than €50 million of either the senior
secured or subordinated debt is repaid, then the €30 million RCF should be
repaid pro rata.
We understand that Bité will likely seek a waiver in the intercreditor agreement in order to extinguish the full €110 million of subordinated debt, without triggering repayment of the RCF, but this has not been requested or granted to date.
In our view, the future reduction in Bité's debt would lead to an
improvement in its leverage and would ease pressure on its consolidated
leverage covenant relating to the group's RCF. On the assumption that €50 million of subordinated debt will be extinguished, if the transaction had occurred at Dec. 31, 2008, it would have resulted in reported debt to EBITDA of about 7.7x. On the same basis, if the €110 million notes are fully extinguished, the reported debt to EBITDA ratio for the same period would improve to about 6.0x.
The exchange offer will lead to more operational flexibility as the
group's annual interest cost will decrease by approximately €10 million
annually or in the remaining months of 2009. In the mean time, in our opinion, Bité is likely to continue to meet its interest payments on its subordinated and senior secured debt.
The negative outlook reflects the fact that Bité's rating will be lowered to 'SD' on completion of the exchange offer.
Following completion of the exchange offer and extinction of an initial
€50 million of the subordinated notes, based on the current information, it is likely that the rating will be upgraded to the 'CCC' category. Any upgrade, however, will follow a review of the group's revised capital structure, including the benefits realized if the offering is successful, the group's liquidity position, and actual and projected operating performance.
