Frontier Communications Announces Restructuring Support Agreement

 

  • Frontier Communications

NORWALK, CT — Frontier Communications announced that it has entered into a restructuring support agreement (RSA) with bondholders representing more than 75% of Frontier’s approximately $11 billion in outstanding unsecured bonds. The RSA contemplates agreed-upon terms for a pre-arranged financial restructuring plan that leaves unimpaired all general unsecured creditors and holders of secured and subsidiary debt. Under the RSA, the bondholders have agreed to support implementation of a plan that is expected 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. To implement the plan, the Company voluntarily filed petitions under Chapter 11 of the United States Bankruptcy Code in the Southern District of New York.

Uninterrupted Customer Service

Frontier expects to continue providing quality service to its customers without interruption and work with its business partners as usual throughout the court-supervised process. The Company has sufficient liquidity to meet its ongoing obligations. Under the RSA, trade vendors will be unimpaired for both pre- and post-petition obligations.

In conjunction with the proposed financial restructuring, Frontier received commitments for $460 million in debtor-in-possession (DIP) financing. The Company’s liquidity will total over $1.1 billion comprising the DIP financing and the Company’s more than $700 million cash on hand. This liquidity, combined with cash flow generated by the Company’s ongoing operations, is expected to be available and sufficient to meet Frontier’s operational and restructuring needs. The DIP financing agreement provides for the additional financing to convert to a revolving exit facility upon emergence.

Northwest Fiber to Acquire Washington, Oregon and Montana Operations

In addition, the Company intends to sell its Washington, Oregon, Idaho and Montana operations and assets to Northwest Fiber for $1.352 billion on or around April 30, 2020.

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