Philippine Long Distance gets required consents for 10 5/8% notes, 11 3/8% notes

By Jennifer Chiou

New York, Oct. 28 - Philippine Long Distance Telephone Co. announced it received the required consents to amend the covenants of its $71.986 million of 10 5/8% notes due 2007 and $250 million of 11 3/8% notes due 2012.

The Manila, Philippines-based telecom company said as of 5 p.m. ET on Oct. 27 - the consent deadline - it received consents from holders of $65,371,000 or 90.81% of 10 5/8% notes and $219,576,000 or 87.83% of 11 3/8% notes.

The amendments relate to the limitation on restricted payments and on indebtedness.

The company also received tenders from holders of $50,826,000 of its 10 5/8% notes, who may deliver consents without tendering.

The company previously said that since it issued the notes, it has significantly deleveraged using cash flow from operations supplemented by dividends from its subsidiary Smart Communications, Inc.

As a result of improved cash flows and reduced debt levels, Philippine Long Distance restored payment of common dividends in May after suspending them in April 2001. It intends to gradually increase the dividend payout and sought noteholder approval to give it greater flexibility to make restricted payments, including payment of dividends. The company is also offering to tighten its permitted leverage ratio to affirm its commitment to maintain leverage at "healthy levels."

In the completed consent solicitation for the 11 3/8% notes, Philippine Long Distance will pay a consent payment of $5.00 per $1,000 principal amount.

The tender payment for the 10 5/8% notes is $1,097.50 per $1,000 principal amount, including a $5.00 consent payment that will only be paid to holders who tendered by 5 p.m. ET on Oct. 27. The tender ends at 5 p.m. ET on Nov. 4. Philippine Long Distance will also pay accrued interest up to but excluding the payment date.

Credit Suisse First Boston is dealer manager and solicitation agent (852 2101-6346 (Alister Moss), 44 20 7888-6999 (Chris Tuffey) or 212 325-7596 (Andrew Karsh)). Bondholder Communications Group is information agent (212 809-2663 (Patricia Lawson) or 44 20 7236-0788). JPMorgan Chase Bank, NA is tender and tabulation agent.

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