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Travelport secures $500 million settlement of debt dispute

Posted by Lee Hayhurst on
Travelport secures $500 million settlement of debt dispute

Travelport has reached an agreement that settles a major $1 billion dispute with its lenders and private equity owners.

The GDS and travel technology giant has agreed new $500 million in funding as part of an agreement with lenders to drop proposed litigation.

In an announcement, Travelport said the financing exchange transactions will be open to all lenders pending the ‘release of all related litigation and claims”.

According to the Private Equity News website Travelport the agreement “cools tensions between…Travelport’s top lenders and its private equity backers Elliott and Siris Capital Group”.

In a statement Travelport said it had reached the agreement with the “Ad Hoc Lender Group Steering Committee”.

This has seen members of the group and affiliates of Travelport’s equity holders agree a $500 Million backstop agreement “to support the financing exchange transactions”.

Travelport said the deal “fortifies Travelport’s ability to continue investing in next-generation technology” and to support customers and grow as travel continues to return.

The financing exchange transactions are expected to close by September 24 subject to the satisfaction of conditions stipulated in open market purchase and exchange agreements.

Travelport said the new financing will provide the company with “ample liquidity to continue to exceed its customers’ expectations and invest in its technology and next-generation platform to help ensure it is positioned for growth as travel returns”.

“It also will provide Travelport with significant annualised cash interest savings, reduced net debt levels and extended debt maturity dates,” it added.

Greg Webb, chief executive said: “With this agreement, we have fortified our ability to continue to strengthen and protect our business from the impacts of the extraordinary COVID-19 global health crisis.

“The support of our owners, Siris and Elliott, and our lenders, coupled with the encouraging increase in travel provides us with even more optimism about the future trajectory of our business as we continue to invest in our industry-leading technology and next-generation platform to ensure we are positioned to drive innovation and growth in the long term.

“We are very pleased to move forward in collaboration with the Ad Hoc Group and look forward to continuing to deliver the best-in-class products and services that our customers have come to expect from Travelport.”

John Swainson, executive chairman of Travelport, added: “We remain fully committed to our sustainability and growth.

“This agreement is a reflection of that commitment and a result of everyone’s efforts over the past several months to ensure that Travelport has the financial strength and capacity it needs to support its customers and grow well into the future.”

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