Li and Oger may cooperate over Vivacom

13 Sep 2010

Hong Kong telecoms and media tycoon Richard Li is considering a deal with Dubai-based Oger Telecom in his battle to retain control of Vivacom (formerly known as Bulgarian Telecoms Company, BTC), writes The Financial Times. Li, who is the biggest shareholder in Vivacom through PineBridge Investments, is exploring restructuring options for the debt-laden company after lenders backed an alternative plan from Oger and mezzanine creditors, one of the sources said. This could include Oger gaining an interest in the company alongside PineBridge.

Oger and the other investors, which together hold EUR325 million (USD412.3 million) of Vivacom’s EUR1.6 billion debt pile, derailed a restructuring proposal by PineBridge to inject about EUR180 million of fresh capital in the business alongside Li’s Hong Kong telecoms firm PCCW. Vivacom, which was saddled with a EUR1.645 billion loan when former owner AIG took control of it in August 2007, agreed a covenant waiver with lenders until the end of October, one of the sources said. In 2009 Li bought ailing insurer AIG’s asset management arm, renamed as PineBridge.

PCCW abandoned its investment plans for Vivacom at the end of last month, when senior lenders opted to support an alternative proposal by Oger and the mezzanine creditors. This also involves a capital injection and an equity conversion of at least part of the mezzanine lenders’ holdings.While PCCW is thought unlikely to return to the table with an offer of fresh capital, PineBridge has not ruled out trying to strike a deal that could still include Oger, and yet preserve its investment, the first source said.

Bulgaria, PCCW Group, Vivacom (BTC)