Posted on 02/12/2009 1:58:35 PM PST by NormsRevenge
NEW YORK (Reuters) – Charter Communications Inc (CHTR.O) said on Thursday it will restructure its heavy debt load under Chapter 11 bankruptcy protection filing by April 1, wiping out shareholders as the company reached a deal with senior debt holders.
The cable operator, controlled by Microsoft co-founder Paul Allen, said in a statement it would file for Chapter 11 on or before April 1 after it reached a deal with some of its creditors helping to reduce its debt by around $8 billion. It had a debt load of around $21 billion as of Sept 30.
Various debt holders and bondholders will receive a mix of new notes, equity and cash depending on their seniority. Shareholders will not receive anything for common stock, which will be canceled.
Under the agreement around $10 billion of bank debt will remain on Charter's balance sheet untouched while the $11 billion held by bondholders will be reduced to $3 billion, people familiar with the agreement said.
The bondholders will have most of their notes converted to new notes and common stock or warrants to buy common stock.
Paul Allen will continue as an investor and retain the largest voting interest in Charter.
Allen's various non-equity holdings in Charter including debt and preferred were converted to equity under the new capital structure, these people said.
Chief Executive Neil Smit said in a statement the agreement covered "a significant portion" of bondholders.
The company, which has more than 5.5 million subscribers, said it would make an overdue interest payment of $74 million before a final deadline of February 15.
(Excerpt) Read more at news.yahoo.com ...
Well I’m a Charter customer, and the lights are still on.
My bill went up by about $7 in Jan. however...
Crappy service X 10
So what does this mean for Charter users?
Ed
I saw his yacht parked at the port of Palm Beach (FL) the week of Christmas.
I was perplexed because we never have cruise ships there. It’s mostly cargo. Then I heard on the radio the next day that he was in town. That ship could pay off shareholders. http://www.TedNugentForSenate.com
the stock is cheap.. 4 cents.
http://www.charter.com/Visitors/Home.aspx
He’s definitely spread his money around.
“So what does this mean for Charter users?”
Nothing.
This is Chap 11 and they’ll be restructured... if they’re liquidated, someone else would buy up their assets (customers and infrastructure), but none of the liabilities, for pennies on the dollar.
Charter is my cable and ISP and is rotten to the core.
In 2007, there were figures on Profits per employee. For charter, there was a loss per employee. $192,000.
They provide crummy HD signal. They sell HD on demand, but none of them work. They lack the bandwidth. Their people are scattered all over including Panama and the Philippines. They came to disconnect the cable of my neighbor that moved and instead disconnected mine. They charged me a $35 house call to get it reconnected. They did not pay the local franchise fee for two years and then when they had to fess up had no money to pay. They upped the price to raise the cash and then gave a free movie every month as compensation. They have started offering phone service and for many it is a total disaster.
If I don’t show up here one day, you’ll know they ceased operations.
Paul Allen would be living on the streets if not for being a childhood friend of bill Gates. That or living with his mother. Wait a sec; he still lives with his mother.
Wonder what the fuel flow rate is when pulling skiers with that thing? /S
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