Vitro presents restructuring counterproposal to senior noteholders

By Caroline Salls

Pittsburgh, March 30 - Vitro SAB de CV has presented a restructuring counterproposal and updated long-term projections to holders of its $1.216 billion outstanding principal amount of senior notes, according to a company news release.

Under the counterproposal, roughly $1.5 billion of Vitro's debt would be restructured, including the senior notes, in exchange for $660 million of new eight-year unsecured notes.

The new notes would bear cash interest from 5% to 7% over the term of the notes.

Additionally, the proposal includes eight-year rights that would provide holders with conditional cash payments in the amount equal to 20% of each EBITDA dollar that is earned above $250 million per year.

According to the release, roughly $275 million of the company's secured debt, off-balance-sheet securitization facilities and other unsecured debt, mainly at the subsidiary level, would not be affected by the proposed restructuring.

The counterproposal is subject to the amortization payments of unimpaired debt not exceeding $40 million per year in fiscal years 2010 and 2011.

Vitro said it continues to focus its efforts on reaching a consensual restructuring agreement with its creditors based on the company's debt capacity.

Though the financial restructuring process is expected to continue for several months, Vitro said it has the financial resources to continue providing uninterrupted products during this time.

Under the updated financial projections, Vitro expects its 2010 EBITDA to be $204 million, its 2011 EBITDA to be $242 million, 2012 EBITDA to be $263 million, 2013 EBITDA to be $265 million and 2014 EBITDA to be $290 million.

Also, the company's projections show that its free cash flow before restructuring debt will be negative $66 million for 2010, $43 million for 2011, $70 million for 2012, $80 million for 2013 and $111 million for 2014.

Vitro is a Nuevo Leon, Mexico-based glass manufacturer.

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