NII restructuring helps all creditors, even objectors - adviser

jueves 11 de junio de 2015 15:19 GYT

By Nick Brown

NEW YORK, June 11 (Reuters) - A financial adviser to NII Holdings' creditors on Thursday testified the bankrupt wireless operator's $4.35 billion restructuring plan is good for all creditors including those who oppose it.

Andrew Scruton of FTI Consulting took the stand in the fifth day of a trial over a plan by NII, which operates the Nextel brand in Brazil, to hand control of the company to Aurelius Capital Management and other holders of $4.35 billion in debt.

The plan, which needs approval of Judge Shelley Chapman in Manhattan bankruptcy court, is supported by most creditors, but opposed by a bondholder faction known as the CapCo group. It alleges Aurelius and other powerful holders designed the plan themselves as a sweetheart deal, costing CapCo $150 million, more than a third of its total payout.

Scruton, who advised NII's unsecured creditors' committee, said the deal will benefit the CapCo group. If Chapman rejected the plan as the group urges, CapCo would recover the $150 million it seeks, but would net a $50 million loss because NII's equity value would drop 10 percent, and other payments would revert to other bondholders, Scruton testified.

The trial is expected to conclude on Monday with closing arguments. A ruling from Chapman could follow any time.

NII went bankrupt in September, later selling its Mexican assets to AT&T Inc for $1.9 billion.

The restructuring plan is based on a settlement resolving several classes of legal claims against NII over intercompany transactions.

In CapCo's view, NII let Aurelius engineer the settlement, willing to accept whatever resolution would yield consensus among its largest creditors.

Last week, NII Chief Executive Officer Steven Shindler testified to the contrary, saying he was "never shy about expressing our view."

In one of the more colorful pieces of evidence to emerge in a bankruptcy trial, NII's lawyer presented an email in which Shindler railed at some of Aurelius' demands. "My blood does not boil over too often, but I am there and ready to unleash the fury," Shindler wrote. (Reporting by Nick Brown; Editing by Cynthia Osterman)