Global Cloud Xchange negotiates with bondholders

Global Cloud Xchange (GCX), a subsidiary of Reliance Communications and owner/operator of a global, undersea cable system, announced a two-week forbearance agreement with 87% of its bondholders.

GCX said the bondholders have committed not to take action for a minimum period of two weeks with the possibility of extending the agreement for an additional two weeks, assuming GCX continues to progress in its negotiations.  The forbearance agreement provides for, among other things, a two per cent consent fee payable to forbearing noteholders and payment of accrued interest to all noteholders (in each case with such amounts being added to the principal amount of the notes rather than being paid in cash); a fee equal to five percent of the outstanding principal amount of the bonds payable to forbearing noteholders if the notes are subsequently refinanced in full; the appointment of a Senior Managing Director of FTI Consulting as a Chief Restructuring Officer; and certain requirements that need to be fulfilled to maintain the forbearance agreement.

 “We appreciate our lenders continued support as we take these next steps and look forward to using the additional time the forbearance agreement provides to pursue the desired refinancing transaction under the best possible terms,” said Bill Barney, Chairman and CEO, GCX. “Meanwhile, we continue to operate as usual as a fundamentally strong company that is uniquely positioned to capture opportunities in our fast-growing markets.”

• In March 2019, Global Cloud Xchange (GCX) announced that its financial performance was on track per guidance for Financial Year 2018-19 (FY19), however, the company confirmed that it had retained Lazard as financial adviser “to evaluate refinancing options for the company and ensure that the upcoming maturity is addressed on competitive terms as soon as possible.”