US wireless backhaul provider FiberTower has filed for voluntary reorganisation under Chapter 11 bankruptcy regulation to manage its debt.
According to FiberTower, it is seeking a reorganisation that would eliminate its long-term debt. This plan, which…
US wireless backhaul provider FiberTower has filed for voluntary reorganisation under Chapter 11 bankruptcy regulation to manage its debt.
According to FiberTower, it is seeking a reorganisation that would eliminate its long-term debt. This plan, which it claims is already supported by an ad hoc group of secured debt holders, would reorganise the group around its “restructured legacy backhaul network”, as well as two other business lines: spectrum services and carrier services.
“FiberTower has taken these steps after evaluating various strategic and financial alternatives and determining that reorganising under Chapter 11 is in the best long-term interests of the company, its customers, employees, creditors, business partners and other stakeholders,” stated the company.
It added that it intends to continue running backhaul operations as normal throughout the Chapter 11 process, and that it had reached an agreement with the ad hoc group of lenders to use cash collateral.
At the time of going to press, court hearing dates for the Chapter 11 process had yet to be announced by the US Bankruptcy Court for the Northern District of Texas. FiberTower has proposed using FTI Consulting as its financial adviser.
In its 17 July court filing, FiberTower Corporation listed total assets of approximately US$331m and liabilities of around US$190m.
The company listed around US$37m outstanding on 9% notes due 2012 with US Bank, which it claims is unsecured.
Among its other unsecured creditors are Ernst & Young and media giant Time Warner.
Late last year, FiberTower announced that it had decided not to make a US$1.3m semi-annual interest payment on 15 November 2011 for its bond due 2012. This constituted as not only a default on this bond, but for the other 9% notes the company holds that are due in 2016.
The company said in court filings that it services around 5,390 customer locations at approximately 3,188 deployed sites in 13 US markets.
