Yell sets last debt-deal deadline

 

Directories publisher Yell may go to court to gain approval for its debt refinancing plan after it announced on Thursday a final one-day extension for lender approval of the deal.

Yell shares have fallen more than 20 percent this week as the company struggles to secure lender backing to refinance its 4 billion pounds of bank loans. Lender approval would open the door to a debt-cutting rights issue.

Yell said about 90 percent of lenders by value had supported the proposals, short of the 95 percent required.

"We are now very near the point where the board may have to draw a line under the current process and move to a scheme of arrangement" John Davis, chief financial officer of Yell, said in a statement.

The proposals would extend the maturity on Yell's debt and amend covenants to allow the equity issue to go ahead.

The company, battling an advertising slump and a structural shift from print to online publishing, has given lenders until 5 p.m. on Thursday to agree the proposals, the third extension to the deadline.

Under a scheme, which would need to be approved by the courts, lenders would be asked to vote again but the company would require approvals from only 50 percent by number and 75 percent by value of those that vote.