New attack of fever between Patrick Drahi and his creditors. According to our information, their talks on the restructuring of SFR’s €20 billion debt have been interrupted for about ten days. Lenders face owner of second French operator.
The billionaire has housed SFR’s largest asset, its fiber network, in a trust, a kind of trust, as L’Informé reveals. It threatens its creditors, and soon future shareholders, that it will no longer have control over them.
However, SFR is far from being a virtual operator, as it remains the owner of its mobile network and frequencies. But this new trip is going badly despite the fact that negotiations have progressed well in recent weeks. “It’s part of the negotiation game,” says another person close to the discussions. “Everyone has their role.”
Each side now awaits SFR’s third-quarter results, published this Wednesday, to relaunch talks. Altice, the telecommunications operator’s parent company, and its creditors declined to comment.
Up to 25% of SFR capital at stake
Patrick Drahi is on his second tour in a few months. In spring, the €3.8 billion resulting from the sales of BFM (including BFM Business), La Poste Mobile and data centers were again exfiltrated from SFR and placed beyond the reach of creditors. A lever that had worked since the negotiations then advanced.
The owner of Altice now undertakes to provide 2.6 billion euros to partially repay its lenders and offer them 18% of SFR’s capital. In exchange, they will erase a third of their debts by refinancing the operator between 13.7 and 14.4 billion euros. The exact amount and, especially, the interest rate of the new debt remains to be negotiated.
Patrick Drahi blows hot and cold. Excluding the fiber network (XP Fiber) is a new way to apply pressure. Altice wants to obtain an interest rate of 6.5%, one point less than what creditors offer. The financial cost amounts to 150 million euros per year, a significant amount, while SFR’s margins fell by 75 million euros in the second quarter alone. In exchange, the billionaire is willing to part with his part of SFR’s capital.
A level that would be good for creditors. They want the largest possible equity stake to benefit from future cash flow and, in particular, the upcoming sale of the fiber network.
Source: BFM TV
