Tiscali 2014 Annual Report Download - page 70

Annual financial report as at 31 December 2014
Date
File Name
Status
Page
-
Annual Report as at 31
December 2014
70
CONSIP on 17 February 2015, in consideration of the acceptances received, on the basis of the
tender mechanism, Tiscali shall have to carry out the services for a portion of the supply equal to 60%
of the overall maximum amount. The current tender configuration with no more than three awarded
parties also makes it possible to develop important commercial action also on the parties of the Local
Public Administrations. As things stand, the Company is awaiting the completion of the formal controls,
preparatory to the final assignment which is envisaged to take place by the end of the 1st half of 2015.
Given the matters stated above, the Directors - when assessing the existence of the assumption of the
Group as a going-concern in the current macro-economic context and the current competitive
scenario, have identified in the unbalanced equity, financial and economic situation which the Group is
headed into, as shown by the negative consolidated shareholders’ equity for EUR 168.8 million, due to
the negative economic performance over the years and the weight of the considerable indebtedness,
factors which indicate the existence of significant uncertainties.
In this context, since the first few months of 2013, the Tiscali Group launched a negotiation process
aimed at restructuring the senior financial debt on a consensual basis in accordance with the Group
Facilities Agreement (“GFA”) entered into on 2 July 2009 with a number of financers (hereinafter
“Senior Financiers” or “Lenders”), for the purpose of ensuring an equity and financial structure capable
of permitting, over the long-term, the achievement of a balanced economic, equity and financial
situation.
The negotiations with the Senior Financiers continued until presentation by the Company, in 2014, of a
preliminary and non-binding proposal concerning, amongst other aspects, a recapitalisation of the
Group, a partial rescheduling of the debt and a reset of the financial covenants envisaged by the GFA.
Subsequent to presentation of this proposal, which received the general consent of the Senior
Financiers, a multi-stage negotiation process was commenced, on the outcome of which the Tiscali
Group:
 on 17 December 2014, approved the business plan (“Business Plan”) and obtained, on 23
December 2014, the related asseveration carried out by a professional appointed as per
Article 67.3, letter d) of the Italian Bankruptcy Law;
 on 22 December 2014, accepted the offer made by a leading Italian real estate fund relating to
the transfer of the leasing agreement concerning the property Sa Illetta where the Group’s
headquarters are located (the “Leasing Agreement”), which may be finalised between the
parties on verification of specific conditions which must take place by 31 March 2015. The
agreements relating to this transaction envisage, among other aspects, that the Tiscali Group
continue to use the Sa Illetta property under market conditions; furthermore, if the disposal
transaction should not be completed by 15 April 2015, the leasing companies involved have
agreed to: (i) redefine the repayment plan; (ii) not avail themselves, until 30 April 2015, of any
of the remedies envisaged in accordance with the Leasing Agreement;
 on 23 December 2014, entered into - with the Senior Financiers - a financial debt restructuring
agreement pursuant to the GFA (“Restructuring Agreements”), for the purpose of achieving,
amongst other things: (i) a partial rescheduling of the debt as per the GFA (which, as of that
date, amounted to around EUR 140 million); as well as (ii) a redefinition of the financial
covenants, for the purpose of bringing them in line with the Business Plan. Specifically, in
short the afore-mentioned agreements envisage:
o the division of the entire debt vis-à-vis the Senior Financiers, amounting to around
EUR 140 million as of the date of entering into the Restructuring Agreements, into
three separate credit facilities: (i) Facility A1, for an amount of around EUR 42.4
million, to be repaid by 30 November 2015, primarily by means of the use of the
proceeds of any share capital increases of the Company; (ii) Facility A2, for an
amount of around EUR 42.4 million, to be repaid in six-monthly instalments, the last of
which falling due on 30 September 2017; (iii) Facility B, for an amount of around EUR