Hibu Plc agreed to a debt writedown valued at GBP 800 million (US$1.2 billion) in exchange for surrendering control of the company under a debt-for-equity restructuring plan.

The agreement represented 32.8% of the debts of the UK yellow pages publisher, a statement released today said.

The company, formerly known as Yell, has been saddled with low earnings as the Internet took attention away from the paper-based directory.  Profits before interest, tax, depreciation and amortization plunged to GBP 283 million in fiscal year ending March 2013 against the GBP 461.3 million the previous year.

Mike Pocock, Hibu CEO, said in a statement that the "the new capital structure is intended to support the business as it drives value from print and digital directories and develops its digital strategy."

Even after the agreement, Hibu still owes about GBP 580 million representing senior secured debt that is due in five years and another GBP 920 million of payment-in-kind notes that will mature in 2023.