Charter emerges from Chapter 11
Charter Communications said it has completed its financial restructuring and is formally out from under Chapter 11 bankruptcy protection.
The company said it has reduced its debt by approximately 40 percent, or approximately $8 billion.
As Barron’s observed , the company remains highly leveraged; one major difference is that old shares in the company are now canceled.
Charter President and CEO Neil Smit said: “We have restructured our balance sheet without losing sight of serving our customers and maintaining our business relationships. Charter will remain focused on further enhancing the customer experience and is positioned to generate free cash flow. On behalf of the management team, I would like to thank the more than 16,000 Charter employees across the country for their hard work and dedication throughout this process.”
The company said it is positioned to generate positive free cash flow through the reduction of more than $830 million in annual interest expenses.
The current debt of company subsidiaries CCO Holdings and Charter Communications Operating will be reinstated under pre-existing pricing and maturity dates. Charter will receive approximately $1.6 billion in proceeds from an equity rights offering to support the overall refinancing and the reduction of approximately $8 billion of debt.
In addition, Charter will exchange existing CCH II notes for approximately $1.7 billion of new 13.5 percent CCH II notes due 2016.
The company said Chairman Paul Allen will continue as an investor and will retain the largest voting interest in the company. The company intends to apply for the listing of its new common stock issued in accordance with the plan on the Nasdaq Stock Market not earlier than 45 days after emergence.
Charter filed its pre-arranged plan and Chapter 11 petitions  on March 27.
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