Creditors set to take control of Hibu

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The owner of Yellow Pages is reportedly poised to be seized by its lenders in a deal set to wipe out shareholders in the group.

Hibu – which changed its name from Yell last year – is said to be in talks over a complex debt-for-equity deal that will see creditors such as Wall Street hedge funds and banks take control of the phone books giant. It is believed the agreement will reduce its debts from around £2.3 billion to less than £1bn.

Once listed on the FTSE 100 Index, Hibu is now worth a fraction of its former £5bn market value after the group, which has 13,000 staff, borrowed heavily to fund a raft of overseas acquisitions before the credit crunch.

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