Telecom Argentina Submits $2.63B Debt Offer For Court OK

BUENOS AIRES (Dow Jones)--Fixed-line carrier Telecom Argentina S.A. (TEO) said Thursday it filed its $2.63 billion debt restructuring offer with a local court, whose approval is the last hurdle before the company can complete its debt exchange.

Telecom Argentina is pursuing an out-of-court restructuring, known by its Spanish acronym APE, where a two-thirds creditor agreement allows a company to submit its offer for legal approval, which then makes the repayment terms binding on all creditors.

The telecommunications company secured 94.47% creditor approval when its offer closed in August. While the level of acceptance is considered high, the company will still have to go through the courts for approval, which means a final resolution to its debt clean-up - the largest among Argentine corporations - might not come for some time.

Previous APE cases have taken several months to get through the judicial process, which gives time for creditors to file objections and appeal the court's ruling on those complaints.

"Telecom Argentina cannot predict the timing of the court approval for its APE but expects to complete its APE process and issue the APE consideration in the first half of 2005," the company said.

Telecom Argentina's cellular phone subsidiary, Telecom Personal, secured 100% creditor approval for its separate $599 million APE in early October, allowing the unit to bypass the court process.

Both the parent company and its cellular division have been in default since early 2002, when four years of recession culminated in Argentina's economic crisis.

-By Wailin Wong, Dow Jones Newswires; 5411-4311-3125; wailin.wong@dowjones.com

(END) Dow Jones Newswires"

Posted to the site on 21st October 2004