Frontier Communications, one of Tampa Bay’s two major cable and internet providers, filed for Chapter 11 bankruptcy Tuesday, according to a Wednesday filing with the Securities and Exchange Commission.
Filed in the Southern District of New York, the bankruptcy would restructure $10 billion of the company’s debt, a move it says will allow the company to move forward.
“With this agreement with our bondholders, we can now focus on executing our strategy to drive operational efficiencies and position our business for long-term growth,” CEO Bernie Han said in a release.
Frontier does not expect any interruptions to its service during this process, the company said.
The ailing telecommunications firm moved into the Tampa Bay market in 2016 when it purchased Verizon’s local internet, TV and landline operations for nearly $10 billion. Since then, it has been plagued by complaints about poor customer service, issues with installations and reneging on advertised rates. Its stock prices plummeted over the last year from $2.64 per share in April 2019 to 28 cents per share Wednesday.
Frontier’s prearragned restructuring proposal is supported by three-quarters of the bondholders who hold $11 billion in unsecured bonds. The deal would come at the expense of 100 percent of the company’s equity. In addition to the restructuring, Frontier announced that it also secured $460 million in financing. If approved, Frontier would have about $700 million in liquid reserves.
“This liquidity, combined with cash flow generated by the company’s ongoing operations, is expected to be available and sufficient to meet Frontier’s operational and restructuring needs,” Frontier said.
A judge will need to give approval for the restructuring.
The company said it still expects to sell its operations in Oregon, Washington, Idaho and Montana at the end of the month for about $1.35 billion in cash to Northwest Fiber. It plans to ask the court for permission to speed up the sale.
• • •
Tampa Bay Times coronavirus coverage
HAVE YOU LOST SOMEONE YOU LOVE TO COVID-19?: Help us remember them
UNEMPLOYMENT Q&A: We answer your questions about Florida unemployment benefits
CONTRIBUTE TO THE SCRAPBOOK: Help us tell the story of life under coronavirus
BRIGHT SPOTS IN DARK TIMES: The world is hard right now, but there’s still good news out there
LISTEN TO THE CORONAVIRUS PODCAST: New episodes every week, including interviews with experts and reporters
HAVE A TIP?: Send us confidential news tips
GET THE DAYSTARTER MORNING UPDATE: Sign up to receive the most up-to-date information, six days a week
We’re working hard to bring you the latest news on the coronavirus in Florida. This effort takes a lot of resources to gather and update. If you haven’t already subscribed, please consider buying a print or digital subscription.