Frontier Agrees On Debt Restructuring, Files For Bankruptcy

Frontier Communications Corporation filed for bankruptcy on Tuesday night, as it has entered into a Restructuring Support Agreement (RSA) with bondholders representing 75% of the high-speed internet company’s $11 billion outstanding unsecured bonds.

The company has spent the last months warning about its going concern and recently had discussions with lenders on restructuring options. And the CDS market has been on top of it…

Under the RSA, the bondholders agreed on a plan “to reduce the Company’s debt by more than $10 billion and provide significant financial flexibility to support continued investment in its long-term growth.” The company said the only way to “implement the plan” is to proceed with “Chapter 11 of the US Bankruptcy Code in the Southern District of New York.”

“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,” President and CEO Bernie Han said.

“At the same time, the COVID-19 pandemic continues to impact the entire business community, and our team is focused on ensuring the health and safety of our employees and customers. The services we provide to our customers keeps them connected, safe and informed, and I would like to thank our team for their continued dedication, especially in light of the current environment,” said Han.

The Connecticut-based company estimates it has assets and liabilities at around $10 billion to $50 billion. The filing also said it would sell telecommunication assets in Washington, Oregon, Idaho, and Montana to Northwest Fiber for $1.352 billion in cash on April 30.

This year could turn out to be the year of bankruptcies. Not just in the oil and gas patch but across the board.