Adelphia Communications Corp. lined up about $1.5 billion in
debtor-in-possession financing from two banks late Friday -- a move that should
pave the way for a Chapter 11 bankruptcy filing Monday, according to
A source close to the company said Citigroup Inc. and J.P. Morgan Chase &
Co. are the lead banks in the DIP financing, which would allow the company to
continue operating as it reorganizes.
That same source said it is very likely that Adelphia will file for Chapter
11 reorganization Monday. 'Monday looks like the day,' the source added.
Adelphia has been negotiating with the banks for weeks regarding the DIP
The MSO first ran into trouble in March, after it revealed that it had $2.3
billion in off-balance-sheet debt. The company later adjusted that figure to
$3.1 billion and revealed a series of self-dealing transactions with its
founding Rigas family.
Currently under investigation by two federal courts and the Securities and
Exchange Commission for accounting irregularities, Adelphia has been teetering
on the brink of bankruptcy since it defaulted on about $7 billion in bank debt,
missing interest payments on bonds totaling nearly $100