Maxcom Telecomunicaciones agrees on recapitalization deal with Ventura Capital Privado

Maxcom Telecomunicaciones (NYSE: MXT) said it has negotiated the terms of a comprehensive recapitalization and debt restructuring that is expected to reduce Maxcom´s debt service expense and position Maxcom for growth with a USD45m capital infusion.

Maxcom, private equity firm Ventura Capital Privado, S.A. de CV and certain of its current equity holders have reached agreement on the terms of a restructuring and support agreement, a recapitalization agreement, and agreements to tender

Maxcom´s recapitalization and debt restructuring will be implemented through a voluntary, prepackaged Chapter 11 filing under the US Bankruptcy Code and an equity tender offer in accordance with US and Mexican securities laws. Maxcom commenced solicitation of votes from holders of the senior notes on July 3, 2013.

The company intends to operate in the ordinary course of business during the implementation of its recapitalization and debt restructuring and continue to provide a high level of responsiveness to its customers, vendors and business partners.

The company has engaged Lazard Freres & Co. LLC and its alliance partner Alfaro, Davila y Rios, S.C. as its financial advisor and Kirkland & Ellis LLP and Santamarina y Steta, S.C. as its US and Mexican legal advisors in connection with its restructuring proceedings and potential Chapter 11 case. The Ad Hoc Group has retained Cleary Gottlieb Steen & Hamilton LLP and Cervantes Sainz, S.C., as its US and Mexican legal advisors. Ventura has retained VACE Partners as its financial advisor, and Paul Hastings LLP and Jones Day as its US and Mexican legal advisors, respectively.

Maxcom Telecomunicaciones, headquartered in Mexico City, Mexico, is a facilities-based telecommunications provider using a “smart-build” approach to deliver last-mile connectivity to micro, small, and medium-sized businesses and residential customers in the Mexican territory.