News
In the company’s latest annual report directors warned that the business could collapse “in August 2024 or sooner”
TalkTalk has staved off defaulting on its debt by securing a refinancing package exceeding £400 million, led by its founder, Sir Charles Dunstone.
Announced today, the deal involves shareholders — including Dunstone, Ares Management, and Toscafund — immediately injecting £65 million in interim funds into the company.
An additional £170 million is set to follow, contingent upon the finalisation of binding agreements among all involved parties. The total refinancing package is reportedly worth £400 million.
Assets currently held separately, such as TalkTalk’s Virtual1 subsidiary and the customer bases from Ovo and Shell, will also contribute.
As part of the agreement, the company’s bank lenders and bondholders have agreed to extend two approaching debt deadlines from November and next February to September 2027. This extension affords TalkTalk additional time to roll out its strategic initiatives for PlatformX (its wholesale division) and its consumer division.
TalkTalk have been struggling with debt for several years, with the total currently standing at around £1 billion.
Earlier this month, it was reported that Macquarie, who had been in line to acquire a £450 million stake in PlatformX, had walked away from the deal. Reports have suggested that Macquarie could reopen negotiations if TalkTalk’s financial situation improves.
“The company is pleased to announce that the key terms of a refinancing transaction have been agreed between a group of senior secured notes (SSN) holders, a group of revolving credit facilities (RCF) banks (the SSN group and RCF group together represent approximately 60 per cent of the company’s secured debt), Ares Management Funds and the company’s major shareholders,” said the company in a statement.
“The proposed transaction will leave the company well-funded to deliver the respective strategic plans of PlatformX Communications and TalkTalk, continuing to capitalise on their strong positions in the market.”
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