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Telereal seeks holder OK to drop Ambac guarantee for three series
By Susanna Moon
Chicago, July 18 – Telereal Securitisation plc is soliciting consents from holders of three series of its notes to release Ambac Assurance UK Ltd. as guarantor.
The notes covered by the solicitation are as follows:
• £240 million class A-3 5.5534% secured notes due 2033 with amortized amount of £192,151,200 and pool factor of 80.063%;
• £370 million class A-5 5.3887% secured notes due 2033 with amortized amount of £228,874,600 and pool factor of 61.858%; and
• £190 million class A-8 4.9741% secured notes due 2033 with amortized amount of £127.3 million and pool factor of consent solicitation fee of 67%.
The early consent deadline is 11 a.m. ET on July 27, and the solicitation will remain open until 5 a.m. ET on Aug. 7.
The consent solicitation fee will be 0.2%.
The company has scheduled bondholder meetings for Aug. 9 in London.
The issuer and Ambac have reached an agreement to release Ambac from its rights and obligations under the original insurance policy, the 2004 Ambac guarantee and the 2006 Ambac guarantee for the class A-3 notes, the class A-5 notes and the class A-8 notes, respectively, according to a company announcement.
The Ambac guarantees were obtained in order to enhance the credit rating of each class of notes; however, since that date, Ambac “has experienced a material deterioration in its financial strength” so that the ratings are no longer enhanced by those guarantees, the release noted.
Despite this, Ambac continues to be the “controlling creditor” for those classes of notes with voting rights “on all decisions that affect the commercial position of the noteholders,” the release added.
The consent solicitation agent is Deutsche Bank AG, London Branch (+44 20 7545 8011). The tabulation agent is Citibank, NA, London Branch (+44 20 7508 3867 or exchange.gats@citi.com).
Telereal is based in London.
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