MyTravel bondholders agree to extend maturity

[Stand 22]

LONDON, Sept 15 (Reuters) - British holiday firm MyTravel said on Monday its bondholders had voted in favour of a proposal to extend the maturity of 300 million pounds ($481.4 million) worth of subordinated convertible bonds due in 2004.

The extension, to the end of 2006, followed an agreement with creditors to refinance 1.3 billion pounds in debt.

MyTravel wanted the extension to give it more time to implement its strategy to turn around its business, which shed its chairman, chief executive and finance director after three profit warnings and accounting errors sent its shares into free fall. The business, like its rivals, was also hit by the war in Iraq and the SARS virus outbreak.

Good news for a change!!! Now lets hope they can turn things around.

Regards

[Viscount Sussex]

Excellent news for the whole industry.
Brilliant news for everybody concerned.
I am sure the Daily Mail will come up with some negative comments or perhaps the Guardian!
Just wait.
:ok:

[Han Special]

The mail said that only 61% of bondholders intended to vote to extend,short of the 75% required.In fact over 99% did.The mail clearly has an agenda to brief against myt for some reason,it is hardly balanced reporting from an otherwise good newspaper.

[carlos vandango]

heard recently that the Mail's bias extends from an incident a few years ago when Airtours successfully sued a Daily Mail Journo. His colleagues have been at this caper ever since..supposedly. Does anyone know the full story?
If true it says a lot for the state of British journalism. There must be some truth in it as the Mail certainly has a very big axe to grind.:\

[Moondance]

The Daily Mail, a "GOOD" newspaper, there's a form of words you don't see very often. I have no objection to the tabloids (comics for adults), very little objection to any of the broadsheets (they have their own political viewpoints, but are usually carefully and intelligently argued) - but the Mail and the Express are very dangerous - unpleasant, extreme right wing tabloids that regard themselves as broadsheets.

[Headset starter]

Thank goodness there won't now be a new flood of pilots onto the market for a good couple of years.

Woo hoo!

HS

:D

[niknak]

Did the bond holders really have a choice?:rolleyes:
No they didn't, if they'd all exercised their rights at the appropriate time MYT would have gone into liquidation almost immediately.
I have absolutely no desire to see MYT go down the pan, or anyone lose their jobs in the aviation industry, but I can't help feeling that MYT are in an extremely precarious postion, and when interest rates do rise again, the knock on effect will hit them first.
It's astonishing that DTI rules allow any company in the UK to continue trading with such large debts (yes I know it's not exclusive to aviation by any means), but I guess that its a simple case of "if you owe the bank a £1000, it's your problem, but if you owe them £100,000, it's theirs.

[A4]

Nik Nak,

I agree that MYT position is still precarious but the Bond holders did have a choice. They could have got back about 50% of the money now but they have decided to wait because they obvioulsly believe that in the longer term they will get more back. The vote was something like 150 million for and 500,000 against - pretty conclusive.

As for the DTi allowing companies to operate - what's the current UK deficit ? :) Most tour operators are in the sh1t at the moment - I think TUI's debt (€6billion ?) makes MYT's look paltry - and TUI's core market/economy (Germany) is absolutely on its knees.

I've said it before and I'll say it again. Tough times for ALL ahead. MYT are scaling back (DC10's retire shortly), Oasis lakes sold in Florida, more disposals / "streamlining" to come. Whilst morale is down within MYT, I do believe there is an underlying determination to get things sorted.

Fly safe.

A4 :)

[Orvil]

Hello,

It does seem to be these days that the more you owe, the less likely the Banks will collect.
MYT owes nothing compared to some giant motor companies.
Ford owes about 900 billion dollars (yes that 900 billion!) and Daewoo( there's not enough numbers!).

I once worked for Airtours, I thoroughly enjoyed it, Good people with a good product. I'm sure they'll pull through.

The Daily Hate, should be burnt to the ground and the Journo's shot. Even better they should re-locate to North Korea, where biased/ waltdisney reporting is encouraged.
Is there a "Ihatethedailymail.com" site, yet?

Goodluck MYT:O :ok:

[newswatcher]

Han special, I know it seems fashionable to knock the "Mail", but when did they say that only 61% of bondholders intended to vote to extend, short of the 75% required I believe this may have been in an article earlier this year, when they incorrectly predicted that the bondholders were against the re-financing proposition. However, in recent articles, they have reported The plans were backed by 99.7% of those bondholders to vote - way above the required figure of 75% - 15/9/03 and To get there MyTravel needs consent from its bondholders. Now it says it is 'confident' a deal will be struck. – 22/07/03 and in "Evening Standard" (same house?) TROUBLED tour operator MyTravel looks set to secure its financial survival next month after revealing today two-thirds of its bondholders will back its restructuring. - 18/08/03 There is another thread on this, complete with "Mail" bashers! - http://www.pprune.org/forums/showthread.php?s=&threadid=102616

[Prince Of Darkness]

Newswatcher:

Thanks for finding some positive quotes from the Daily Mail.

Just as a matter of interest, how many negative quotes on the subject of MyTravel could you find by The Mail and Financial Mail?

I bet it's more than three!

And I bet most of them were inaccurate!

PS. You MyTravel people have a lifeline to turn things around; I sincerely hope you do, you're a good bunch.

[newswatcher]

PofD, actually I didn't have to "find" anything, these were from the last few articles relating to MyTravel. What makes you think that the rest of the article was "positive"?

As you must be aware, it is difficult to quote from the "Mail", since they don't have an online edition.

Perhaps you should read what MyTravel have said in their own press releases over the last 18 months. For example, on the "bond" deal - 6/6/03 There remains some uncertainty over whether this extension to the maturity date of the Convertible Bonds can be achieved in the time and on trading - 6/6/03 I expect the summer performance to be better than last year yet only 2 months later - 1/8/03 The Company now believes that operating profit for the second half of the current financial year will be similar to the results for the second half of last year

[keepitlit]

The daily moaner will do anything to get the dirt,even as far as drinking a bottle of wine in the morning in front of Besty after his latest fall out with his wife to see if he would give in to the tempation,only to find out that the journo was from his homeland
:mad:

[TightSlot]

Since their problems first began, I've watched MYT's progress in this forum with interest. Those who promote them so ardently seem to have used a variety of defenses, such as (more or less in order of use): -

1. There is no problem, this is just scaremongering by competitors and the Media. We can resolve it.
2. There is a problem, but it is small, and being grossly exaggerated by competitors and the media. We can resolve it
3. There is a big problem, and competitors and the media are taking unjust advantage of a temporary situation, which is making it difficult for us to resolve.
4. If you think our problems are bad, you should see how badly our competitors are doing. Can they resolve them?
5. There was a problem, now we have resolved it, but our competitors and the media are trying to pretend that we haven't.

It seems to me that we ought to be able to agree on some points at least, without being accused of MYT bashing, namely: -

* Those who work for MYT are generally good, competent and efficient workers, who deserve better than they have received from their Board of Directors. They are NOT the cause of the recent and continuing problems at MYT.

* The Board of Directors have proved themselves in the past year to be largely incompetent, mendacious and greedy and almost criminally negligent towards the welfare of those that they employ. They ARE the cause of the problems at MYT.

* Competitors will seek to take commercial advantage of the weekness in MYT's position. That is normal, and MYT would do precisely the same were the circumstances reversed.

* The media may sometimes publish negative stories about MYT: That is also normal. The media have no responsibility whatsoever to write favourable comment about any company. If they are negative, so what? Deal with it.

MYT are now going to have to work very hard for several years to ensure that they can pay the bondholders, and to reassure investors. I hope they succeed, but would be encouraged if the bleating stopped and some PPrune posters showed a better understanding of how they got to be in this situation, and what it will take to get out of it (this thread is more balanced than most)

[A4]

It was however, not suprising, that the day BEFORE the vote the Mail on Sunday had a prominent article about how the banks were bailing out of MYT and there was no support for the company etc. No other publication ran a similar story.

Then the vote occurs - 150 million for and 500,000 against.

The next day the DM had literally 3 lines of a tiny column about the market in general regarding the result of the vote. Probably no more than 20 words. Most other publications ran positive(ish) stories about time to now get it in order etc.

Now call me a cynic but don't you think that's kind of odd when you consider the history of DM and MYT reporting ..
:yuk: :rolleyes:

[newswatcher]

A4, you say No other publication ran a similar story. yet from an article in the "Daily Telegraph" - 16/9/03 City bankers warned, however, that MyTravel remained precariously financed. The bonds were trading last night at just 26.5p in the pound, up 1p, while its bank debt has recently been changing hands for as little as 20p in the pound. One banker said: "In my view, this just buys time. They will need another refinancing." You also say The next day the DM had literally 3 lines of a tiny column The DM could not possibly have had a comment about the bondholders decision on the day it was made, since they are a morning paper! I think the 3 lines you mention, were probably from the Evening Standard, and were remarkably upbeat On the upside, MyTravel jumped 3 1/2p to 20 3/4p after announcing that its bondholders have voted in favour of an extension to its £221.6m debt repayment by three years until 2007. and Orvil :hmm: Ford owes about 900 billion dollars (yes that 900 billion!) where on earth did you get this nugget from? The actual figure is about $165bn, according to their own qrtly report, released in June this year! Their total liabilities are around $300bn!

[Han Special]

ok, after having read the back issues of 40 articles,most of them predicting imminient collapse and that no deals will be done etc, I think it is safe to conclude that the reporting is inaccurateand that there certainly is a negative agenda towards the company. if they were sued for libel in the past this would explain their attitude.

[A4]

OK Newswatcher, I bow to your superior knowledge reflected in your title. BUT, the DT article sounds exactly the same as the MoS article - syndicated / rehashed?

As for the Mail not being able to report it the same day - I didn't say that;

Quote from me;

"Then the vote occurs - 150 million for and 500,000 against. The next day the DM had literally 3 lines of a tiny column ....." QED.

So Ford owes ONLY $165 billion not $900 billion. Isn't it all a bit academic after the first $10 -20 billion ? :rolleyes:

A4 :)

[newswatcher]

A4 thanks for your reply. I was merely responding to your assertion that "No other publication ran a similar story". The DT is certainly NOT in the same "house" as the DM, in fact they are often "daggers drawn", so funny that they published the same info, as you say probably syndicated. You could say that the MoS were on the ball, in that they published 2 days earlier!

Apologies for misreading your "next day" reference, I thought you meant the day after the MoS article. Wasn't the bit I quoted the same as appeared in the DM? It''s the only online reference I can find from either the MoS or DM.

The size of the "debt" is particularly relevant, when considering "debts" against "assets". If my figures are correct, MyTravel has a balance sheet "debt" of £718m against "assets" of £829m. Fords have a balance sheet "debt" of $165bn against "assets" of $306bn. Having a debt of $900bn against "assets" of $306bn, might have caused ructions on Wall Street!!

At least we know their "debts", it always amazes me when companies like Enron collapse with such mega-debts, and no-one seemed to know about this beforehand! Those auditors certainly have something to answer for!

[A4]

Newswatcher said:

"Those auditors certainly have something to answer for!"

A4 says "That's putting it mildly!" :mad: :)

[Max Continuous]

Good luck to all at MyT - wish it was still called Airtours, though. Just booked my fourth holiday cruise on Sunbird - excellent value!
As for the Daily Mail, it's worth every penny of the cover price just for the daily codeword and Fred Bassett .....

[TightSlot]

FYI - Posted on e-TID today Link To Article (may require registration/log-on) (http://www.e-tid.com/index.asp?URL=viewarticle.asp?id=20836)

]Lenders wrest high price from MyTravel for latest debt revision

MyTravel will be allowed to use the proceeds from disposals as working capital after its lenders agreed to revise the Jun03 agreement in exchange for a potentially hefty ‘consent’ fee.
The June deal had insisted that any cash be used to reduce debt.
The fee will increase on a sliding scale until May 2006, the date when MyTravel’s £1.3bn debt is due to be refinanced. The amount payable will be up to 13.5% of the increase in its market capitalization above a £50m base level, with MyTravel able to reduce the percentage payable by refinancing the current arrangement earlier than May 06.

Coverage in today’s FT points out that if MyTravel’s market cap reaches £1bn – around half its peak - the banks would end up with £128m if MyTravel allowed the percentage to reach its upper limit.

A similar arrangement was included in the June deal when the lenders negotiated another consent fee, this time in exchange for agreeing to the refinancing in the first place. The June arrangement is also based on a percentage of the increase in MyTravel’s market cap of up to 15%, although this fee starts at a base level of £40m.

However, a limit of £65m was put on the lenders’ first fee – the consent agreed yesterday has no upper limit.



And also, more positively perhaps on UK-Wire Financial News (http://www.uk-wire.com/cgi-bin/articles/200310010700583911Q.html)

MyTravel sells German and Polish businesses

MyTravel Group plc announces the disposal of its loss-making business in Germany and its smaller business in Poland.


In Germany, the Group sold Frosch Touristik GmbH (FTi) to RM3366, a privately-owned German company. FTi also operates in Austria and Switzerland. In the year to 30 September 2002, this business made an operating loss before goodwill and exceptional operating losses of £31.2 million on sales of £422.6
million and losses have continued in 2002/03. In view of its record and the difficult trading environment, FTi was not considered likely to make a positive contribution to the Group's turnaround. At 30 September 2002, FTi had net liabilities of £30.0 million, funded primarily by loans from the Group. Since that date FTi has been recapitalised by MyTravel (including through capitalising the intragroup loans) and it has been sold for a nominal consideration.

In Poland, the Group sold its two tour operators, Ving Sp z o.o. and Itaka Sp z.o.o., to a consortium including members of its management team. There was no material cash consideration for the sale.

The disposals will result in an exceptional loss in the year to 30 September 2003 of £86 million.

In addition, the Civil Aviation Authority has confirmed that it will be renewing the Group's Air Travel Organisers' Licences (ATOLs) with effect from 1 October 2003.