Courts approve bankruptcy plans

By Susan Rush
From The September 6, 2002 Edition Of CED Broadband Direct

Bankrupt companies Teligent Inc. and NTL Inc. have received some good news. Their individual plans to emerge from bankruptcy have been blessed by the courts.

Less than a year and a half after filing for Chapter 11, Teligent Inc. expects to emerge from bankruptcy on or before Sept. 16. The U.S. Bankruptcy Court of the Southern District of New York has approved the plan, which will enable the wireless broadband provider to exit bankruptcy debt free, fully funded and with all of its fixed wireless assets intact.

Teligent filed for bankruptcy protection from its creditors in May 2001. The company ran out of options after failing to secure $350 million to make interest payments that had come due. At the time of the filing, analysts were speculating that Teligent would sell off its assets, rather than emerge from bankruptcy.

The plan calls for Teligent's senior secured lenders to fund the reorganized company, and own 100 percent of its stock.

The company has spectrum licenses in 74 markets. It will continue to sell Internet services to its enterprise customers, transport services to carriers and point-to-point broadband access services to multi-location businesses.

Separately, the US Bankruptcy Court for the Southern District of New York in Manhattan approved NTL's reorganization plan. The cabler anticipates emerging from bankruptcy next month, just five months after filing for Chapter 11 protection.

Under the approved plan, NTL's $10.6 billion in debt will be swapped into equity in two reorganized companies - NTL UK and Ireland and NTL Euroco. Bondholders will receive 100 percent equity in NTL UK and Ireland and 86.5 percent equity in NTL Euroco.