Liberty Latin America Ltd. filed a Current Report on Form 8-K on September 15, 2026, disclosing the status of ongoing restructuring discussions with certain holders of its debt. The company stated that negotiations among the Restricted Holders, the LPR Entities, and the Company concerning a Potential Transaction have taken place but are no longer continuing. The filing indicates that no agreement has been reached, and there are no assurances that a future agreement will be reached.
The report includes two exhibits containing the latest commercial term sheets exchanged between the LPR Entities (or the Company) and the Restricted Holders. These documents outline a proposal to reconsolidate the existing RemainCo/UnSub structure and separate Liberty Puerto Rico (LPR) from Liberty Latin America into a standalone business, known as “New LPR,” which would operate under a Transition Services Agreement (TSA) with Liberty Latin America.
The term sheets detail several key financial components. The proposal includes a $410 million “First-Out” Notes facility to refinance existing UnSub debt, with the size to be determined based on the amount of outstanding UnSub debt and applicable call protection. The facility is intended to be backstopped by AHG and offered to all term loan and bondholders. Additionally, the proposal includes an extension of the existing UnSub Revolving Credit Facility (RCF) to a size of $140 million, with a five-year tenor and a rate of S + 400 basis points.
Regarding debt restructuring for existing first lien creditors, the proposal suggests a “Second-Out” Takeback Debt of $1.250 billion with a seven-year tenor and an 8.00% interest rate. The proposal stipulates that this takeback debt must result in a total leverage ratio of no more than 4.0x. The term sheets also address equity treatment, proposing that 75% of pro forma equity be allocated to participating holders on a pro rata basis, with the remaining 25% allocated to Liberty Latin America. The company notes that specific details, such as the exact strike price for warrants and the duration of the Transition Services Agreement, are subject to further legal diligence and ongoing discussions.
