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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 or 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of January, 2006
GRUPO IUSACELL, S.A. de C.V.
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(Translation of registrant's name into English)
Montes Urales 460
Col. Lomas de Chapultepec, Deleg. Miguel Hidalgo
11000, Mexico D.F.
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(Address of principal executive office)
Indicate by check mark whether the registrant files or will fill annual reports
under cover of Form 20-F or Form 40-F: Form 20-F [X] Form 40-F [ ]
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g-3-2(b) under the Securities and Exchange Act of
1934. Yes [ ] No [X]
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Documents Furnished By the Registrant
1. Press Release of the Registrant dated January 23, 2006
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
GRUPO IUSACELL, S.A. DE C.V.
Date: January 23, 2006 /s/ Fernando Cabrera
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Name: Fernando Cabrera
Title: Attorney in fact
/s/ Jose Luis Riera
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Name: Jose Luis Riera
Title: Attorney in fact
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INVESTOR CONTACTS
[LOGO OF IUSACELL]
Jose Luis Riera K.
Chief Financial Officer
5255-5109-5927
J.Victor Ferrer
Finance Manager
5255-5109-5273
vferrer@iusacell.com.mx
IUSACELL REACHES AN AGREEMENT TO RESTRUCTURE ITS DEBT.
o Grupo Iusacell, S.A. de C.V. and its main operating subsidiary Grupo
Iusacell Celular, S.A. de C.V. have reached an agreement in principle
with the majority of their creditors to restructure their debt.
Mexico City, January 23, 2006 - Grupo Iusacell, S.A. de C.V. [BMV: CEL]
("Iusacell") and its main operating subsidiary Grupo Iusacell Celular, S.A. de
C.V. ("Iusacell Celular" and together referred as "Grupo Iusacell" or "The
Company"), announced today that after several months of constructive
negotiations, they have reached an agreement in principle with the majority of
their creditors to restructure it's indebtedness.
GRUPO IUSACELL, S.A. DE C.V.
Iusacell has reached an agreement with creditors representing over 51% (the
"Majority Creditors") in principal amount of its US$350 million 14.25% notes due
in 2006 (the "Existing Notes"). The agreement in principle involves a potential
exchange offer of the Existing Notes.
The new notes (the "New Notes") to be issued in exchange for the Existing Notes
will be in the principal amount of US$175 million and will bear interest at an
annual rate of 10% with semi-annually interest payments in arrears (with
Iusacell having the option to capitalize up to 40% of each interest payment).
The maturity date for the New Notes will be December 31, 2013. It is
contemplated that the New Notes will be secured by a pledge on Iusacell shares,
representing between 28% and 34% of the fully-diluted common stock of the
Company. The granting of the pledge will be subject to certain terms and
conditions.
The Existing Notes could be exchanged for the New Notes in the terms described
above. Iusacell also would be seeking a consent solicitation for the amendment
of certain terms and conditions of the Existing Notes and a waiver of certain
events under such notes. The Majority Creditors have agreed, subject to certain
conditions, including the negotiation of definitive documentation and the
achievement of various milestones, to timely tender their debt and consent to
the modification of certain terms and conditions of the Notes, pursuant to the
contemplated debt exchange offer and consent solicitation and other related
transactions. Iusacell is contemplating to launch the exchange offer and consent
solicitation on or before March 15, 2006. All Existing Notes tendered in the
exchange offer will be cancelled upon the consummation of the transaction, and
past due interest on the Existing Notes, which was approximately US$150 million
as of December 31, 2005, will be forgiven.
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GRUPO IUSACELL CELULAR, S.A. DE C.V.
Grupo Iusacell Celular, S.A. de C.V. ( "Iusacell Celular") has also reached an
agreement in principle with creditors representing the majority of its secured
debt (the "Majority Secured Creditors" ) involving a potential exchange offer of
the existing secured debt (the "Existing Secured Debt").
The Existing Secured Debt includes US$190 million of existing Tranche A Bank
Loan ("Existing Tranche A Loan"), US$76 million of existing Tranche B Bank Loan
("Existing Tranche B Loan") and US$150 million 10% Senior Notes due in 2004
("Existing Senior Notes"). This agreement is preliminary in nature and subject
to documentation.
The agreement contemplates that the US$190 million Existing Tranche A Loan would
be exchanged for US$190 million new first lien notes (the "New First Lien
Notes"). Main terms of the New First Lien Notes would include a first lien on
substantially all of Iusacell Celular's assets, in the terms and conditions of
the existing lien, with interest at Libor + 400 basis points, payable quarterly,
and final maturity 2010.
Further, under this agreement the US$76 million Existing Tranche B Loan and
USD$150 million Existing Senior Notes would be exchanged for approximately $203
million of new second lien notes (the "New Second Lien Notes"). Main terms of
the New Second Lien Notes include a second lien on substantially all of the
assets of Iusacell Celular, under the terms and conditions of the existing lien,
interest at 10% per annum with semi-annually payments (the Company will have the
option to capitalize up to 30% of each interest payment), and maturity in 2011.
All Existing Senior Notes tendered in the exchange offer will be cancelled upon
the consummation of the transaction, and past due interest on the Existing
Senior Notes, which was approximately US$44 million as of December 31, 2005,
will be forgiven.
The New Notes, the New First Lien Notes and the New Second Lien Notes will be
issued pursuant to an exemption from the registration requirements of the
Securities Act of 1933. The exchange offers may be consummated as voluntary
exchanges or through any other legal means available to the Company and Iusacell
Celular, under applicable insolvency and business reorganization laws.
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THIS PRESS RELEASE IS NOT AN OFFER FOR SALE OF THE SECURITIES IN THE UNITED
STATES, MEXICO OR IN ANY OTHER JURISDICTION, AND NONE OF THE SECURITIES TO BE
ISSUED PURSUANT TO THE EXCHANGE OFFER, IF CONSUMMATED, MAY BE SOLD IN THE UNITED
STATES ABSENT REGISTRATION OR AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR IN ANY OTHER JURISDICTION WHERE SUCH SALE
IS PROHIBITED. THE COMPANY DOES NOT INTEND TO REGISTER ANY OF THE SECURITIES TO
BE ISSUED PURSUANT TO THE EXCHANGE OFFER IN THE UNITED STATES OR TO CONDUCT A
PUBLIC OFFERING OF SUCH SECURITIES IN ANY JURISDICTION OTHER THAN THOSE AS IT
MAY FROM TIME TO TIME PUBLISH.
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ABOUT IUSACELL
Grupo Iusacell, S.A. de C.V. (Iusacell, BMV: CEL) is a wireless cellular and PCS
service provider in Mexico with a national footprint. Independent of the
negotiations towards the restructuring of its debt, Iusacell reinforces its
commitment with customers, employees and suppliers and guarantees the highest
quality standards in its daily operations offering more and better voice
communication and data services through state-of-the-art technology, such as its
new 3G network, throughout all of the regions in which it operate.
LEGAL DISCLAIMER
Grupo Iusacell, S.A. de C.V. quarterly reports and all other written materials
may from time to time contain statements about expected future events and
financial results that are forward-looking and subject to risks and
uncertainties. For those statements, the Company claims the protection of the
safe harbor for forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995. Discussion of factors that may affect future
results is contained in our filings with the Securities and Exchange Commission.
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