(March 4): A group of secured creditors of Altice France SA, unhappy with the deal arranged between the company and a majority of its creditors to cut about €8.6 billion (US$9 billion or RM40.2 billion) of debt, have tapped advisers to find ways to improve their terms, according to people familiar with the matter.

These creditors — which hold debt maturing in 2028 and 2029 — are working with law firm Ashurst LLP and boutique French advisory firm Ceres Partners. They weren’t part of the steering committee that led the negotiations, but had signed a cooperation agreement preventing them from negotiating a separate deal with the company, said the people who asked not to be identified discussing private information.

In the deal with its creditors announced by the troubled French telecommunications company last week, secured creditors would get a 31% stake in the firm, a cash payment of about €1.5 billion, new debt with tighter contractual rules and a fee in exchange for writing off part of the debt and extending the maturities.

Under that deal, secured creditors with the most long-dated maturities — 2031 and 2032 once the extension is implemented — would receive interest ranging between 5.5% and Euribor or SOFR plus 6.88%, depending on the instrument and whether it’s dollar- or euro-denominated.

While the increase is the same for all the instruments — a 1.375% bump from current payouts — this group of holders doesn’t believe the increase fairly reflects the risk the longer-dated debt holders are taking given the company’s deteriorating performance, some of the people familiar said. The idea is to negotiate an improvement of the terms that would be applied to everyone holding the same instruments, the people said.

Spokespeople for Altice, Ashurst and Ceres declined to comment. Octus was first to report on the mandates.

Altice France and its creditors started discussions to slash its €24 billion debt pile in July. Negotiations were complex given the size of the company, the number of parties — 17 people in the steering committee of secured creditors alone — and different jurisdictions involved.

The breakthrough happened in recent weeks when the company negotiated directly with its three largest holders, BlackRock Inc, Elliott Investment Management and Pacific Investment Management Co, according to separate people familiar with the matter. Representatives for BlackRock, Elliott and Pimco declined to comment.

The cooperation agreement — a pact creditors sign to protect themselves from having other existing investors negotiating side deals with the company — can’t force signatories to agree on a deal, but would make a potential challenge of a deal more complex and other signatories of the pact could decide to sue those investors if they consider they have breached the agreement.

Uploaded by Siow Chen Ming