The financial restructuring, which is expected to be carried out through a reorganization plan, would allow for full repayment in cash of the company's US$210 million Debtor-in-Possession (DIP) financing.
A few months ago, WOM Chile filed for bankruptcy protection in the United States in order to restructure its financial situation under Chapter 11, from which it plans to emerge in early 2025.
The company reported that the Special Committee of Independent Directors of WOM announced that it received a binding proposal from Stalking Horse Bidder for a restructuring transaction, which is currently in the process of negotiating its final form.
“The negotiated terms contemplate an investment of new funds of approximately US$500 million through a fully-backed rights offering, as well as a value of the company of US$1.6 billion,” he said.
The financial restructuring, which is expected to be carried out through a reorganization plan, would allow for full repayment in cash of the company's US$210 million Debtor-in-Possession (DIP) financing.
In addition, WOM would thereby significantly reduce the leverage on its balance sheet and generate a substantial recovery for unsecured creditors, in the form of cash, recovered debt and/or shares of the reorganized Company.
"The transaction is subject to final documentation, ongoing marketing and approval by the Bankruptcy Court for the District of Delaware," the company said in a statement.
Other potential bidders are actively engaged in the due diligence process to evaluate a potential acquisition of the Company and the deadline for receipt of binding offers is November 15.
Martín Vaca Narvaja, CEO of WOM Chile, commented that the proposed transaction will provide them with “the capital necessary to fully finance our business plan, including the full completion of the 5G project deployment.”
“It will also ensure the continuity of our operations while reducing the leverage on our balance sheet and position WOM for future growth,” he added.
Finally, the executive indicated that in the coming weeks they expect to complete the marketing process, finalize the transaction documentation and request approval from the Delaware Court, “to allow a successful exit from Chapter 11 in early 2025.”
