Hedge fund, Varde, may change £359 million of debt in equity to secure ownership of Crest Nicholson, The Telegraph reports. As per the deal, £200 million of the senior debt will be converted into equity along with £150 million of subordinated payment in kind, Pik debt, and £9 million of interest payments from the Pik debt.

After the completion of the swap, Crest will be left with about £150 million of senior debt. The debt-for-equity swap will allow Crest to extend bank facilities until 2015. Varde has already acquired more than 80% of Crest’s senior debt over 2010. Currently, Crest has £500 million of senior bank facilities, which are due for repayment in March 2012.

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