Yell creditors back refinancing

Shares in Yellow pages publisher Yell Group (YELL) soared by 13% on Monday after the troubled group announced the requisite 95% of lenders had agreed its refinancing plans for its £3.8 billion debt mountain.

The FTSE 250 group, which has been badly hit by the advertising downturn and the rise of online publishing, was last week waiting on two lenders to approve it proposals after it pushed the deadline back three times.

It wants to extend the repayment date on its current loan facilities to 2014 in return for raising the interest rate payable by 1%.

The firm, which racked up its heavy debts following a acquisition spree in Spain and the United States earlier in the decade, is also looking to issue bonds or equity in the coming 18 months to slice a further £300 million off its long-term debt.

It says it now plans to tap investors for at least £500 million. It will approach its major shareholders and announce details of the equity raise "as soon as practicable".

For an alternative look at Yell group check out the recent iBall TV episode on the company.
 
John Davis, chief financial officer of Yell, said: "We are delighted that our proposals have been so overwhelmingly approved. We have over 1,000 lenders' commitments, and collecting their acceptances has been a huge logistical exercise.

We are naturally very grateful to all our lenders for what is virtually unanimous support and look forward to announcing details of the planned equity raise in the near future."
 
The group's shares were up almost 6% at 10.15am at 54.2p.
 
Investors writing on Interactive Investor's Yell discussion board were hoping for a push towards 60p.
 
Knellerwoman says: "Strange days when Yell looks more secure than RBS."
 
Nickctaylor was a little more cautious: "Still a huge debt. Nothing been done about that. Don't forget the interest levels of debt repayment are worse than before not better and they struggled to service that."