Denis O'Brien founded the company in 2001, which now has operations in 25 markets across the Caribbean and Central America. Photograph: iStockDigicel, Denis O’Brien’s heavily indebted telecoms group where creditors have moved to take control, plans to invest about $50 million in a transformation programme to boost revenues and improve efficiency in an effort to reboot earnings, according to sources.
It is understood about half of the planned investment will be provided for in the company’s current financial year that comes to an end on March 31st, with the remainder taken in the next fiscal period. The programme will involve a series of initiatives. The company said on Wednesday that a proposed restructuring would see its borrowings fall by $1.8 billion as bondholders swap much of its debt for equity. It added that the resulting $110 million of annual interest savings would help ensure “cash to fund operations and invest in key growth areas”, underscoring how both sides to the restructuring talks see the need for investment to turn the group around.
Sources familiar with details of the plan said holders of bonds in two group subsidiaries, Digicel Limited and Digicel International Finance Limited, were on track to swap almost $1.18 billion of notes for a direct initial 90 per cent equity stake in the operating business.