HAMILTON, Bermuda, April 11 -- Flag Telecom Holdings Ltd.'s board has approved a proposal for a restructuring that would pay all the company's creditors and equipment suppliers, while common equity holders would be substantially diluted.
Flag Telecom said none of its creditors have agreed to the proposal yet. The company plans to exchange Flag Atlantic Bank debt of about $257 million for about $70 million in cash and common equity. Flag Telecom also plans to exchange $430 million of its 8 1/4-percent senior notes due in 2008 for about $170 million in new senior notes.