(Updates with closing share price in third paragraph.)
Dec. 9 (Bloomberg) -- Yell Group Plc is proposing to cut its revolving credit less than formerly planned and is offering higher fees to non-bank lenders to obtain their consent for debt amendments, according to a person with knowledge of the talks.
The publisher of U.K. yellow pages directories wants to reduce the facility by 100 million pounds ($156.4 million) to 75 million pounds, said the person, who declined to be identified because the deal is private. Yell is also offering an extra 25 basis-point fee to those invested only in its term loans.
Stock of the Reading, U.K.-based company has dropped 62 percent this year to 5.44 pence a share after full-year revenue fell 12.4 percent to 1.88 billion pounds, as its printed directory business declines with customers switching to digital media. Yell is seeking relaxed borrowing conditions and to buy back 160 million pounds of loans at a discount to allay debt repayment concerns.
Under earlier proposals, Yell planned to reduce its revolving credit by 142.6 million pounds to return cash to lenders including HSBC Holdings Plc, Deutsche Bank AG and Royal Bank of Scotland Group Plc. Non-bank lenders blocked the original plan on the basis that the buyback is skewed toward banks in the revolving credit and that it would leave the company too strapped for cash.
The deadline for voting has been extended to 5 p.m. on Dec. 16, the person said.
Yell needs support from at least two-thirds of debt holders for the amendments to pass. The new terms would require Yell to keep at least 50 million pounds at the end of each month after debt repurchases, and that revolving credit funds may not be used to repurchase debt, the person said.
Yell spokesman Jon Salmon declined to comment. A basis point is 0.01 percentage point.
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