The Ad Hoc Committee of bondholders in MyTravel Group plc and MyTravel announced that they have reached agreement in principle that…
The Ad Hoc Committee of bondholders in MyTravel Group plc and MyTravel announced that they have reached agreement in principle that the Committee will support MyTravel`s balance sheet restructuring. MyTravel is now seeking voting agreements in respect of the restructuring from the wider bondholder group. MyTravel is also seeking confirmation from the banks and other financial institutions participating in the restructuring of their agreement to this revised proposal.
The Committee`s decision to support the restructuring follows agreement with MyTravel that the terms of the consensual restructuring proposal will be revised as follows:
- Bondholders will receive eight per cent. of the issued share capital of the Company following the restructuring.
- Bondholders will be entitled to interest on their Bonds accruing up to and including 25 August 2004 which shall be paid on the Restructuring Completion Date but will have no right to interest accrued after that date
The Committee has agreed to halt its legal challenge to the scheme of arrangement proposed by MyTravel, and MyTravel has agreed to pay the Committee`s legal costs. MyTravel will continue to seek the Court`s sanction of the scheme but will not make the scheme effective if the revised consensual proposal is approved by bondholders at the meeting of bondholders to be held on 29 December 2004.
MyTravel notes that the Trustee for the bonds has issued a notice to the bondholders stating that an event of default has occurred under Condition 14(d) of the bonds (as a result of the transfer of assets proposed in connection with the scheme of arrangement, without the consent of the Trustee). MyTravel does not accept that there has been an event of default. The Trustee`s action was taken without reference to the Committee, whose members have confirmed that it is not relevant to their decision to agree to the revised consensual restructuring proposal. The Committee will request the Trustee to take no action in respect of this alleged default and the voting agreements to be entered into by them will contain an undertaking to waive the alleged event of default.
A spokesman for the bondholders said: The Committee decided to support the consensual restructuring following MyTravel`s decision that it would no longer seek a ruling on whether the bondholders have an economic interest in MyTravel. The bondholders have always been open to a consensual deal, and are pleased that their issues with the company have now been resolved.
A spokesman for MyTravel said: We are pleased that we have been able to reach this agreement with the last remaining creditor group of the company. The restructuring is nearing completion and will provide a sound foundation for the future of the Group.
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