Waterford skips Dec. 1 interest payment on 9 7/8% mezzanine notes, secures loan default forbearance

By Caroline Salls

Pittsburgh, Dec. 1 - Waterford Wedgwood plc elected not to make the Dec. 1 semiannual interest payment on its €166.03 million 9 7/8% mezzanine notes because it is still in discussions with a number of interested institutional investors regarding a possible investment in the company.

According to a news release, Waterford expects that a more comprehensive financial restructuring will be a pre-condition to any investment, and the investment would be larger than the company's originally planned equity funding.

The company said the 30-day grace period for making the interest payment began on Dec. 1.

In addition, Waterford said its senior lenders have agreed to forbearance in connection with a cross-default under the facility agreement.

The company said the cross-default stems from the non-payment of the notes coupon, a breach resulting from the testing of covenants that require the company to maintain €15 million of available but undrawn credit under the facility agreement and a requirement to raise €150 million of new equity by Nov. 30.

While this forbearance is scheduled to run through Dec. 5, the company said it is continuing its discussions with its senior lenders in parallel with ongoing discussions with the interested institutional investors.

Waterford is an Ireland-based luxury table- and dinnerware manufacturer.

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