U.S. 4th Largest Cable Operater comes out of Bankruptcy

Posted by Chris O'Sullivan

Article by Kelsey Volkmann (WSJ)

Charter Communications Inc., one of the largest cable-television and Internet services providers in Massachusetts, has emerged from Chapter 11 bankruptcy with $8 billion less debt.

Judge James Peck in U.S. Bankruptcy Court in the Southern District of New York approved the pre-arranged financial restructuring Nov. 17, which was filed March 27 and considered one of the nation’s largest and most complex bankruptcy filings.

Through the plan, Charter, the fourth-largest U.S. cable operator, will shave off $8 billion from the $21 billion debt it took on through acquisitions and service upgrades to compete with larger rivals. The company, which has 5.3 million customers and reported a loss every year since going public in 1999, said it expects to generate positive free cash flow through the reduction of more than $830 million in annual interest expense.

Charter’s plan generates $1.6 billion in proceeds from an equity rights offering; reinstates $11.4 billion of its senior bank debt at below-market rates; and gives Microsoft co-founder Paul Allen the largest voting interest at 35 percent.

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