Blue Star bosses bow to bond holder anger
Less than a week ago, Blue Star had been insisting its proposal was bondholders' only hope of getting at least some of their money back, even though its own documents show that is a long shot.
The only alternative, directors had said, was receivership for Blue Star which would make certain bondholders would lose all their money.
However, it appears bondholders were prepared to sink the company rather than approve the restructuring deal which was considerably more favourable to the shareholders than to the bondholders.
It remains to be seen whether the concessions will be sufficient to swing bondholder support behind the proposal, which asks bondholders to relinquish significant rights and to exchange the $137.3 million in principal and interest they're owed for a package with a net present value of $44 million with no certainty even that return can be achieved.
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