Cablecom, the Swiss cable television concern, has completed a financial restructuring process after lenders and other holders of economic interest in Cablecom's bank debt reached a final agreement. The restructuring process had begun in June.
Under the deal, a group of US private equity firms comprising Apollo Management, Soros Private Equity Partners and Goldman Sachs Capital Partners have acquired a 51 per cent equity stake in Cablecom, which is Switzerland’s leading cable network provider, through a structured debt-for-equity swap.
“The consortium has acquired a significant portion of Cablecom’s debt at a deep discount,” said Christopher Hall, a partner at Latham & Watkins, which advised the consortium. In total, the three private equity firms are understood to have invested $350m in the deal.
The transaction, designed to ensure the long-term future of the debt-laden business which spun out of NTL Europe earlier this month, involved the restructuring of E2.63bn of pre-existing bank debt, reducing it to approximately E1.1bn. The consortium now controls a majority stake in Cablecom, with most of the remaining equity ownership being in the hands of the members of Cablecom’s bank lending group, which includes Royal Bank of Scotland and JP Morgan Chase.
A feature of the transaction was the use of a Cayman Islands multi-issuance vehicle to repackage a portion of the restructured debt, thereby enabling a large number of non-bank lenders to settle their outstanding trades and obtain exposure to the credit facilities.
“The successful financial restructuring enables us to be cash-flow positive and continue to invest in our national infrastructure,” said Rudolf Fischer, chief operating officer at Cablecom.
Cablecom, based in Zurich, supplies cable services to approximately 1.5m households. Cablecom has a workforce of approximately 1,300 employees and operates across Switzerland.
Latham & Watkins advised the consortium on the debt restructuring. Wachtell, Lipton, Rosen & Katz advised the consortium on shareholder issues, whilst Kirkland & Ellis advised on the remaining corporate issues.
Clifford Chance acted as the main adviser to the bank lending group and Travers Smith Braithwaite advised Cablecom as to matters of English law. Piper Rudnick advised NTL.