GTS Restructuring Finances
In a separate release:
Global TeleSystems (Europe) Limited, formerly known as Esprit Telecom Group plc ("Esprit Telecom"), a subsidiary of Global TeleSystems, Inc. ("GTS") (NYSE: GTS; Easdaq: GTSG; Frankfurt: GTS), today announced it has commenced a consent solicitation with respect to certain proposed amendments to its $230,000,000 11-½% Senior Notes due 2007, its DM 125,000,000 11-½% Senior Notes due 2007, its $150,000,000 10.875% Senior Notes due 2008 and its DM 150,000,000 11% Senior Notes due 2008 (collectively, the "Notes"). The consent solicitation will expire at 5:00 p.m., New York City time, on 10 April 2001 (the "Expiration Time"), unless earlier terminated or extended by Esprit Telecom on or prior to 9:00 a.m., New York City time, on the business day following the Expiration Time. The primary purpose of the consent solicitation is to amend certain provisions of the indentures governing the Notes in order to permit Esprit Telecom to enter into proposed senior secured credit facilities with its parent, GTS. The GTS credit facilities are intended to provide Esprit Telecom with interim funding in connection with the implementation of a reorganization of GTS's Business Services division and a restructuring of Esprit Telecom's obligations under the Notes.
In a separate release:
Global TeleSystems, Inc. ("GTS") (NYSE: GTS; Easdaq: GTSG; Frankfurt: GTS) today announced that it has reached an agreement with an informal committee (the "Committee") of the holders of notes issued by GTS's subsidiary, Global TeleSystems (Europe) Ltd., formerly known as Esprit Telecom Group plc ("Esprit Telecom"). Under the terms of this proposed restructuring, Esprit Telecom's obligation to repay approximately $500 million of the debt represented by these notes will be exchanged for the holders' receiving a 90% ownership interest in a new company that will own Esprit Telecom as well as the other GTS subsidiaries providing principally voice services to businesses in Western Europe. GTS also has agreed, subject to conditions, to provide this new company up to EUR35 million in senior secured debt financing for working capital from 1 April 2001 through 31 December 2001. GTS will provide up to an additional EUR20 million in senior secured debt financing (which will be repaid with preferred stock in the new company upon consummation of the restructuring of Esprit Telecom) to be used by this new company to purchase backbone transmission services from GTS's Ebone unit. GTS will own through a subsidiary the remaining 10% of the equity in the new company, and will hold warrants to acquire an additional 10% of the new company.