LONDON (ShareCast) - Panmure Gordon has its rating for Yell Group (LSE: YELL.L - news) under review after the Yellow Pages publisher
said it has started talks with its banks over a comprehensive refinancing.
Panmure Gordon reckons the key point in the refinancing talks will be the revised interest rate, which will apply from 2011 onwards; the blended interest rate on Yell's current debt is 8%.
The broker reckons the stock is highly speculative, with the equity valued at almost zero and a conventional rights issue more or less out of the question. "More certainty over debt costs is a clear positive, so at least an end is now in sight," the broker concludes.
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