Jun, 2002 : XO Communications Files for Chapter 11 Protection
📅 - Broadband communications services provider XO Communications (XO.com 👉 Total Reviews: 5
🙌 Average Rating: 1 / 10
👍 Good Reviews: 0
👎 Bad Reviews: 5
👈 Official Responses: 0) announced on Monday that it has filed a voluntary petition to reorganize under Chapter 11 of the US Bankruptcy Code in the US Bankruptcy court for the Southern District of New York.
XO says the Chapter 11 filing is limited to the parent corporation, XO Communications Inc., and does not include any of the company's subsidiaries. As such, the filing is not expected to affect the relationships between subsidiaries and their customers and vendors.
The company says it does not expect any reductions in workforce or facility closings as a result of the filings, and will continue to pay employees and provide benefits without interruption during the restructuring.
Along with its Chapter 11 filing, says XO, the company submitted a two-pronged plan of reorganization, including two alternate restructuring scenarios, both intended to result in a successful reorganization. The first would involve the successful completion of the company's investment agreement with Forstmann Little & Co. and Telefonos de Mexico SA de CV. Forstmann Little and Telmex said last week that they do not expect XO to be able to meet the conditions of the agreement, and requested that it be terminated. XO refused the request.
XO says it has also developed a stand-alone restructuring plan that would take effect should it be unable to meet the investment agreement's conditions. The stand-alone plan provides for the conversion of the loans under XO's $1 billion secured credit facility into common equity and $500 million of pay-in-kind junior secured debt.
Because the filing does not affect the company's subsidiaries, XO says it plans to conduct business as usual with regard to its customers. The company says it expects the companies dealing with subsidiaries to be unaffected, while the smaller group of vendors dealing directly with the parent corporation will be subject to the Chapter 11 process.
"This financial restructuring and the related Chapter 11 filing are not a result of operational issues, but are driven by a need to deleverage the Company and resolve our balance sheet issues," says Dan Akerson, XO's chairman and chief executive officer. "Simply stated, the Company has too much debt, given the current and projected level of business operations."
The proposed reorganization plan and its related disclosure statement are subject to the approval of the bankruptcy court and the Company's principal creditor groups.
🙌 Average Rating: 1 / 10
👍 Good Reviews: 0
👎 Bad Reviews: 5
👈 Official Responses: 0) announced on Monday that it has filed a voluntary petition to reorganize under Chapter 11 of the US Bankruptcy Code in the US Bankruptcy court for the Southern District of New York.
XO says the Chapter 11 filing is limited to the parent corporation, XO Communications Inc., and does not include any of the company's subsidiaries. As such, the filing is not expected to affect the relationships between subsidiaries and their customers and vendors.
The company says it does not expect any reductions in workforce or facility closings as a result of the filings, and will continue to pay employees and provide benefits without interruption during the restructuring.
Along with its Chapter 11 filing, says XO, the company submitted a two-pronged plan of reorganization, including two alternate restructuring scenarios, both intended to result in a successful reorganization. The first would involve the successful completion of the company's investment agreement with Forstmann Little & Co. and Telefonos de Mexico SA de CV. Forstmann Little and Telmex said last week that they do not expect XO to be able to meet the conditions of the agreement, and requested that it be terminated. XO refused the request.
XO says it has also developed a stand-alone restructuring plan that would take effect should it be unable to meet the investment agreement's conditions. The stand-alone plan provides for the conversion of the loans under XO's $1 billion secured credit facility into common equity and $500 million of pay-in-kind junior secured debt.
Because the filing does not affect the company's subsidiaries, XO says it plans to conduct business as usual with regard to its customers. The company says it expects the companies dealing with subsidiaries to be unaffected, while the smaller group of vendors dealing directly with the parent corporation will be subject to the Chapter 11 process.
"This financial restructuring and the related Chapter 11 filing are not a result of operational issues, but are driven by a need to deleverage the Company and resolve our balance sheet issues," says Dan Akerson, XO's chairman and chief executive officer. "Simply stated, the Company has too much debt, given the current and projected level of business operations."
The proposed reorganization plan and its related disclosure statement are subject to the approval of the bankruptcy court and the Company's principal creditor groups.
URL source: http://www.thewhir.com/marketwatch/xoc061702.cfm
Company: XO Communications
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