Thomson auction settlement moves closer after contract listing

Isda has published the provisional list of deliverable obligations necessary for auction settlement on media and electronics firm Thomson.

The Isda credit derivatives determinations committee ruled on August 12 that a restructuring credit event had occurred with respect to Thomson, and dealers had initially expected the deliverables to be published within a fortnight.

Much of Thomson’s €2.84 billion debt is privately placed, the company says, so it has taken the determinations committee longer than expected to source the necessary information on the deliverables.

According to the preliminary list posted on the Isda website, there are 12 possible bonds and loans deliverable into CDS contracts referencing Thomson and they fall into three of the eight maturity buckets created by the recent Small Bang protocol. They are the two-and-a-half year bucket, the five-year bucket and the seven-and-a-half year bucket.

Once the contracts have been triggered, auctions can be held to determine the recovery rates. If no bonds or loans with longer maturities are added to the preliminary list, there will be three separate auctions, one for each of the maturity buckets.

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