Frontier Communications filed for Chapter 11 chapter yesterday, however the struggling telecom mentioned its service to prospects will not be affected by the monetary restructuring.
“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,” Frontier mentioned in final evening’s chapter announcement. Frontier filed within the US Bankruptcy Court for the Southern District of New York.
Frontier provides Internet service in 29 states however expects to finish a $1.four billion sale of operations in Washington, Oregon, Idaho, and Montana to Norththeyst Fiber by April 30. In the 25 remaining states the place it can hold providing service, Frontier has 2.6 million Internet subscribers, with 1.four million on DSL and 1.2 million on fiber.
“The bankruptcy filing marks the end of an era during which Frontier Communications racked up roughly $17.5 billion in debt as part of an aggressive expansion campaign that turned it into one of the nation’s largest telecom companies,” The Wall Street Journal wrote immediately. Frontier expanded through the years partly by shopping for former Verizon and AT&T wireline operations.
As a part of its chapter, Frontier mentioned it can “reduce our debt by more than $10 billion” in an settlement that offers bondholders extra fairness within the firm. Frontier additionally obtained $460 million in new financing and mentioned it can have “significant financial flexibility to support continued investment in its long-term growth.”
Widespread network issues
Frontier is extensively reviled for its dangerous customer support, and it has performed a poor job sustaining its copper telephone and broadband network, resulting in investigations and complaints of continual outages in New York, Minnesota, Ohio, and West Virginia. Frontier’s failure to correctly redact an audit additionally helped reveal the poor situation of its network.
Frontier acknowledged to buyers in current they’ve that its “significant under-investment in fiber deployment” contributed vastly to the corporate decline. Frontier mentioned a “large portion” of its income is from “declining legacy products” like copper-landline telephone service and that DSL-customer losses are anticipated to extend. Frontier advised buyers that it intends to “transform the business from a provider of legacy telecom services over a primarily copper-based network to a next-generation broadband-service provider with long-lived fiber-based infrastructure.”
Bettheyen the brand new $460 million in financing, $700 million money available, anticipated income from the pending sale to Norththeyst Fiber, and income from continued operations, Frontier mentioned yesterday it expects to manage to pay for to cowl “operational and restructuring needs.”
The Federal Communications Commission issued a press release immediately saying that it “will be vigilant in ensuring both that Frontier’s customers stay connected to vital 911, voice, and broadband services and that Frontier continues to put the federal funds it receives through the Connect America Fund and other universal service programs to work for the American people.” Frontier just lately missed one in every of its deadlines for deploying FCC-funded broadband.