Hibu, the debt-ridden directory company formerly known as Yell, has extended the deadline for its creditors to agree to waive repayments as the group attempts to stave off threats of liquidation.
The original deadline of November 9 will be extended to November 23 as the directory company attempts to cut a deal with creditors. Hibu suspended all repayments to the group’s lenders in October, wiping out much of the remaining value in the company’s shares.
Hibu also said it would create a scheme so that only three-quarters of debtholders would have to agree to forgo payment. As it stands, all creditors have to unanimously agree. “It’s a fallback,” said someone with knowledge of the situation.
Hibu, which changed its name from Yell earlier this year, has struggled under the weight of its net debt, taken on during an acquisition binge in the late 1990s. Although it has knocked almost £1bn off its total net debt since then, the figure still stands at £2.2bn.
The deadline only affects a small number of creditors who signed up to the 2006 debt facility. Together, these creditors are owed a tranche of debt worth £65m which was due to be paid last month and have threatened the company with liquidation.
Shares in the group fell 15.6 per cent to an all-time low of 0.27p, having stood at more than £6 in 2007. The group’s market capitalisation is now under £8m.
The group reiterated that the restructuring was “likely to result in little or no value being attributed to the group’s ordinary shares”.