Sign Of The Times? – This Caribbean Mobile Telecoms Giant Files For Chapter 15

denis-obrien-digicel
Mobile Phone Entrepreneur Denis O'Brien walks along the streets next to the Iron Market June 23, 2010 in Downtown, Port au Prince. (Photo by Antonio Bolfo/Getty Images)
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News Americas, NEW YORK, NY, Weds. May 20, 2020: Is it a sign of the times? A well-known Caribbean mobile phone network and home entertainment provider operating in 33 markets across the region, Central America, and the Oceania regions, has filed for bankruptcy.  

AP reports indicateDigicel, owned by Irish billionaire Denis O’Brien, has filed for Chapter 15 recognition in a federal bankruptcy court in the Southern District of New York after it was granted an application for provisional liquidation in Bermuda.

The news comes as the company tries to restructure its $US6.7 billion debt and came just days after the company implemented group-wide salary reductions. It involves the appointment of three provisional liquidators from KPMG, the global services company.

However, in a statement, the company has insisted that its day-to-day operations in the Caribbean, central America and the western Pacific will not be affected by the filing even though it’s debt-financing costs have increased significantly as the group faced declining revenues in key markets, such as Haiti, Jamaica and the French West Indies.

Digicel Group had a total outstanding debt of $7.4 billion at the end of the third quarter of 2019. About $1 billion in debt is due to mature next year and about $4 billion by 2024.

For the financial year ending March 2019, Digicel’s annual turnover was reported as $2.3 billion with an operating profit of $479 million, according to the financial statements submitted to the court.

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