High-profile businessman Denis O’Brien, who last week agreed to hand over control of his telecoms empire Digicel to creditors, has told the Sunday Independent he remains “fully committed” to the Caribbean mobile phone group.
igicel last week announced Mr O’Brien had agreed with a group of bondholders to give up his majority stake in the telecoms group in exchange for a debt write-down of $1.8bn (€1.7bn). It follows years of wrestling with the company’s complex debt pile, which peaked at $7bn.
Speaking exclusively about losing control of the company he founded 22 years ago, he said he was pleased to have reached the high-stakes deal.
“I am delighted that we were able to reach agreement with the bondholders, in principle,” said Mr O’Brien, who has been considered one of Ireland’s wealthiest men for many years, due in large part to the value of his holding in Digicel.
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He acknowledged the challenges facing the company, highlighting in particular the many problems in Haiti, which is Digicel’s largest market. However, he insisted many opportunities still lie ahead for the heavily indebted company.
“We have a very cohesive board and a hugely committed management team and workforce,” he said.
“While there are many challenges, there are as many opportunities. I am fully committed to Digicel.”
He is expected to lose up to 90pc of the company although over time his stake in the business could increase to as much as 20pc.
Mr O’Brien and Digicel came under pressure for a number of reasons, including the fact currencies in some of its 25 markets have weakened.
The company’s debt is denominated in dollars while most revenues are in local currencies, putting a squeeze on debt repayments. Rising interest rates would have made refinancing at a manageable level close to impossible.
Meanwhile, Haiti is in the grip of an economic and political crisis since the assassination of its president, Jovenel Moise in 2021, with gangs overrunning much of the country.
“It has been a very challenging time with currency weaknesses in most markets and the gourde in freefall in Haiti,” Mr O’Brien said.
“There has been a complete breakdown in law and order in Haiti.”
News of the radical deal with bondholders broke in the very early hours of Wednesday morning.
The company underwent a debt restructuring in 2020 which saw bondholders write off $1.6bn, while Mr O’Brien invested $50m of his own money.
In recent weeks Digicel had sought a debt extension with holders of $925m of bonds that fell due last week. But more large repayments are due next year and in 2025 and the challenges in Haiti added to the need to enter into a more radical debt restructuring.
The agreement is backed by a group representing 50pc of bonds and has the backing of Mr O’Brien, but has still to be finalised.
Mr O’Brien was in Haiti 10 days ago meeting management and staff in schools. While he was there he signed off on an extension to a school named after the late Colm Delves, former CEO of Digicel Group, one of 180 schools built by the Digicel Foundation.
“What is happening in Haiti is so sad,” he said. “Normal life is being stolen from millions of people. Every day brings more kidnappings and more murders.
“Gangs roam the street of Port-au-Prince; murders and kidnappings take place every day.
“People are afraid to go to work, some parents are even afraid to send their children to school.
“But we cannot let them give up hope. The school routine is very important to the children. Parents really want to get them to and from school every day. We have wonderful teachers, they are totally committed.”
Mr O’Brien established Digicel in Jamaica in 2001 using around €200m in proceeds from his sale of Esat Telecom. He has enjoyed dividends worth $1.9bn from Digicel.
He was previously a shareholder in Independent News and Media, now Mediahuis, which publishes this newspaper and others. Mr O’Brien sold his radio business Communicorp in 2021.
His current assets include Quinta do Lago in Portugal, the Beacon Hospital and Actavo, formerly Siteserv.
