Windstream logo logotipo

Facing $310M judgment, Windstream files for bankruptcy

Bankruptcy tied to 2015 spinoff, Uniti Group, Inc.

By Denise Ray This email address is being protected from spambots. You need JavaScript enabled to view it.

Windstream Holdings filed for Chapter 11 bankruptcy protection in New York Monday, Feb. 25.

“Windstream did not arrive in Chapter 11 due to operational failures, and currently does not anticipate the need to restructure material operations,” Windstream CEO Anthony W. Thomas said in a statement Monday.

With the approval of the bankruptcy court, the network communications company plans to continue to pay employees and maintain services and vendor relationships. Windstream said on Monday it had received a commitment from Citigroup Global Markets Inc. for $1 billion in debtor-in-possession financing to support business operations.

The financing, combined with cash generated by the company’s ongoing operations, will be available to meet Windstream’s operational needs, the company said.

A U.S. district court on Feb. 15 ruled against Uniti Group Inc., a spinoff of Windstream’s fiber and cooper assets, saying Uniti violated agreements with bondholders and exposed the company to a $310 million judgment.

“The Board of Directors and management team of Windstream determined that filing for voluntary Chapter 11 protection is a necessary step to address the financial impact of [the] decision,” Thomas said.

Thomas called the reorganization "a necessary step to address the financial impact" of the judge's decision and "the impact it would have on consumers and businesses across the states in which we operate." 

"Taking this proactive step will ensure that Windstream has access to the capital and resources we need to continue building on Windstream's strong operational momentum while we engage in constructive discussions with our creditors regarding the terms of a consensual plan of reorganization," he said. "We acted decisively to secure the long-term financial stability of Windstream, and we are confident that, upon completion of the reorganization process, we will be even better positioned to invest in our business, expand our speed and capabilities for our customers and compete for the long term."

Windstream received a commitment from Citigroup Global Markets Inc. for $1 billion in debtor-in-possession financing that would help it meet its operational needs.

In its legal filings, Windstream alleged that "Aurelius acquired its position" as bondholders "for the sole purpose of seeking to manufacture this alleged default and declare that a credit event has occurred or is occurring, in order to collect a credit default swap payoff."

Thomas said the company was "disappointed" and "frankly surprised" and said executives would pursue "all available options, including post-trial motions and an appeal. He said the firm would also work with creditors on the next course of action. 

Meanwhile, Aurelius issued a statement saying that Windstream could have "easily" averted the outcome "first by not playing fast and loose with its noteholders in 2015" and "second by settling. 

"Instead, Windstream wasted an exorbitant amount—more than would have been needed to settle with us at the time—on an ineffective exchange offer and then on litigation," Aurelius said. "In our view, a management and a board with an extreme and unwarranted assessment of Windstream's legal case chose to bet the company. The company lost."

Windstream has set up a website with more information on its restructuring at https://windstreamrestructuring.com/

It filed the bankruptcy petitions in the U.S. Bankruptcy Court for the Southern District of New York.

Newest Stories - News

David Howe featured Veterans Day speaker at Big Canoe Chapel

David Howe featured Veterans Day speaker at Big Canoe Chapel

National Garden Association 2019 photo contest now accepting submissions

National Garden Association 2019 photo contest now accepting submissions

Habitat Pickens honors founder with building name

Habitat Pickens honors founder with building name

ITG Radio hosts ‘San Francisco Nights,’ ‘Looney Tunes’ Sunday nights

ITG Radio hosts ‘San Francisco Nights,’ ‘Looney Tunes’ Sunday nights

Diamond Dog Park to host first Doggie Trot Show Nov…

Diamond Dog Park to host first Doggie Trot Show Nov. 9

BCAR Maggie’s House – Elegant Prince Yogi yearns for a…

  BCAR Maggie’s House – Elegant Prince Yogi yearns for a forever home

Welcome home, SSG Adam Stahlbusch

Welcome home, SSG Adam Stahlbusch

Veterans Day Parade Nov. 11 to honor our veterans

  Veterans Day Parade Nov. 11 to honor our veterans

The good water witches of Lake Petit prepare for Halloween

The good water witches of Lake Petit prepare for Halloween

Big Canoe Fire Department graduates its largest volunteer class

Big Canoe Fire Department graduates its largest volunteer class

Clara – In need of a home of her own

Clara – In need of a home of her own

Inside the Gates Radio will rock Big Canoe on Sunday…

Inside the Gates Radio will rock Big Canoe on Sunday, Oct 27

Keep your houseplants healthy and happy by preparing them an…

Keep your houseplants healthy and happy by preparing them an indoor winter home now

Dental school coming to North Gate Station

Dental school coming to North Gate Station

Good Sam’s JumpStart delivers life-changing skills, tips

Good Sam’s JumpStart delivers life-changing skills, tips

Advertisement

SmokeSignals Online
11293 Big Canoe
Big Canoe, GA 30143
PH: 706-669-7095

©2019 Big Canoe News