Charter Files for Chapter 113/27/2009 9:39 AM Eastern
Charter Communications said it filed its pre-arranged reorganization plan and Chapter 11 petitions in U.S. Bankruptcy Court for the Southern District of New York, a plan expected to reduce the cable operator's debt by about $8 billion.
Agreements in principle contemplate the investment by bondholders of more than $3 billion, including up to $2 billion in equity proceeds, $1.2 billion in roll-over debt and $267 million in new debt to support the overall refinancing.
Saddled by $21.7 billion in debt at the close of 2008, the Chapter 11 filing will bring relief on that front, shaving off some $8 billion in debt.
Charter, the nation's fourth-largest cable operator, had indicated that it would file for bankruptcy protection by April 1.
It was previously reported, from securities filings, that chairman Paul Allen is expected to see his voting interest in Charter decline from about 91% to 35% but he will retain the largest voting stake in the company he assembled.
Check Multichannel.com for updates as the story develops.