Digicel continues operations as it prepares to liquidate holding firm

Digicel continues operations as it prepares to liquidate holding firm

Jamaican operator Digicel has filed for Chapter 15 recognition in a US federal bankruptcy court as it moves to the next stage of its debt restructuring strategy.

Earlier this week, the Irish-owned group made a similar liquidation filing in Bermuda. In a statement, the company confirmed that the legal actions would not affect its operations, saying that it remained open for “business as usual.”

The filings concern the liquidation of Digicel Group One Limited (DGL1) - a holding company which does not operate any services – as a condition for a deal with Digicel’s bondholders that will see the company’s debt burden slashed by around US$1.7 billion.

DLG1 and another unit are being dissolved and replaced by Digicel Group 0.5 Limited (DGL0.5), which will assume control over the group’s operations across its footprint in the Caribbean, Latin America and the Pacific.

The company noted that its court filing was “necessary to ensure that scheme creditors are treated consistently, that the Bermuda Court’s sanction of the scheme is enforceable in the US, and that the company and its property are protected from seizure or lawsuits in the US.”