Dec. 6 (Bloomberg) -- Yell Group Plc extended the deadline for lenders to give their consent to its plan to cut 2.6 billion pounds ($4.1 billion) of debt after failing to muster enough support, a person with direct knowledge of the talks said.
The plan by the publisher of U.K. yellow pages directories didn’t pass on Dec. 2, said the person, who declined to be identified because the discussions are private. The new deadline for consent is tomorrow at 5 p.m.
Yell, based in Reading, England, is seeking relaxed borrowing conditions and to redeem loans at a discount. Non-bank lenders objected on the basis that the benefits of the buyback are skewed toward banks in a revolving credit, the person said. The tender aims to reduce the revolving credit to 30 million pounds from 173 million pounds, the person said.
The non-bank lenders hold more than a third of the votes, enough to block the plan, the person said. Yell needs support from at least two-thirds of debt holders for the amendments to pass, the Financial Times reported today.
Yell spokesman Jon Salmon declined to comment.
Lenders that agree to the request by the end of the month will receive a 50 basis-point fee, the person said. A basis point is 0.01 percentage point.
Moody’s Investors Service said it may cut Yell’s Caa1 rating on Nov. 10, citing the company’s plan to redeem loans at high discounts.
Standard and Poor’s downgraded Yell’s debt one level to CC with a negative outlook on Nov. 21.
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