Lumen Technologies has reached an agreement in principle with a group of banks lenders and an ad-hoc group of creditors for a comprehensive restructuring deal, said two sources familiar with the matter.

The telecom group held intense negotiations with its creditors over the weekend to reach a deal by 31 January for a transaction support agreement.

Last fall, Lumen announced plans to push out debt maturities and raise new money as part of a transaction support agreement with a group of lenders. The deadline to complete the deal was extended until the end of January from 31 December to allow for negotiations with banks that are required under the TSA to agree to extend a revolving credit facility and term loan A.

The deal reached in principle further ropes in the holders of Lumen’s USD 1.25bn 4% senior secured notes due 2027, the sources noted.

“It’s a global fix,” of the capital structure, noted one of the sources.

The 2023 TSA was struck with a group of creditors to Lumen subsidiary Level 3 Communications that hold over USD 7bn of debt. These creditors agreed to provide the company with USD 1.2bn in new funding and extends the maturities on some of Lumen’s existing debt. The proposal further adjusts terms of the debt to eliminate questions on covenant compliance.

Other creditors advised by Gibson Dunn and Evercore opposed the original TSA and worked to craft their own counter proposal.

The group of Level 3 creditors is advised by Davis Polk and Houlihan Lokey. Guggenheim Securities and Wachtell Lipton are with the company.

Lumen did not respond to requests for comment. Bank of America, the lead bank on the Lumen revolver, also did not return a request for comment.