Yellow Pages owner Hibu falls over worthlessness warnings

SHARES in Hibu, the stricken owner of the Yellow Pages, plummeted yesterday as management confirmed that the company’s stock could become completely worthless.

The company, which was formerly known as Yell, announced yesterday it had obtained a request to negotiate a debt restructuring with a group of creditors that own hundreds of millions of pounds of Hibu debt from 2009.

The company said it had won “various waivers and an amendment including the ability to negotiate with the lenders on a capital restructure”.

It said “a number of capital structure options are being considered” but that all of those options “are likely to result in little or no value being attributed to the group’s ordinary shares”.

Although it had made this warning before, shares in the company still fell by more than 13 per cent yesterday, following a pop last week.

Standard & Poors, the ratings agency upgraded the company’s debt last Wednesday, which saw stock rise around 50 per cent.

The company is currently in the process of restructuring various tranches of debt, which dwarf its £9.3m market capitalisation.

As Yell, Hibu faced continually declining revenues from its core Yellow Pages business, and it rebranded itself earlier this year as it pushed to become a digital-focused directory business.

However, the shift has failed to pay off and Hibu’s six-month revenues crashed from £69m to £7m in the period to the end of September. Since rebranding, shares have fallen by two-thirds.