Yipes joins Chapter 11 club
The latest broadband communications provider to join the Chapter 11 club is Yipes Communications Inc.
The San Francisco-based service provider filed for Chapter 11 bankruptcy Friday in U.S. Bankruptcy Court in San Francisco as it tries to restructure its business. Yipes provides broadband business connections based on Ethernet technology ranging from 1 Megabit per second to 1 Gigabit per second in 21 markets.
The company has arranged for debtor-in-possession financing, which will allow it to keep its operations online as it reorganizes.
While company officials say the business remains strong, without new funding Yipes is facing a cash crunch in meeting its debt obligations for fiber infrastructure and real estate. It hopes to restructure these debts to ease that pressure.
"This proposed restructuring is unavoidable given the unprecedented pessimism affecting providers of capital to the telecom market," said Jerry Parrick, Yipes CEO, in a statement. "Although our pioneering technology has proven its merits and customer demand for Yipes services is exceptionally strong, the 'perfect storm' now battering the telecom industry has pummeled even the mighty, and we are no exception."