A new news report coming in this morning suggests that debt ridden UK broadband ISP TalkTalk may have finally reached a £400 million deal with its lenders. The deal could be announced today and would buy the operator time to resolve their underlying financial woes by extending the group’s debt maturities to 2027 – avoiding an ugly default.
According to Sky News, the deal will see TalkTalk’s shareholders (led by founder Sir Charles Dunstone, as well as Toscafund and Ares Management) agreeing to immediately inject £65m into the company, with a further £170m to follow. Some leadership changes would also occur, with CEO Tristia Clarke becoming a Non-Executive Director in September 2024 and being replaced by James Smith, while Dunstone will remain Group Chairman.
The £235m capital injection would then be complemented by an asset package (i.e. parts of the company normally held separately) worth roughly the same value (i.e. capital and asses worth a total of c.£400m) to entice lenders, which is expected to bundle-in wholesaler Virtual1 and the customer bases acquired from SSE Broadband (Ovo) and Shell Energy (here).
TalkTalk has declined to comment on this, but we will update again today if that changes.