Telecommunications company Otelco Inc. successfully confirms prepackaged chapter 11 plan of reorganization 43 days after the bankruptcy filing.
On May 6, Willkie client Otelco Inc., a telecommunications company based in Oneonta, Alabama, successfully confirmed a prepackaged chapter 11 plan of reorganization. Confirmation of the restructuring plan occurred 43 days after the bankruptcy filing. The plan of reorganization provides for the company’s senior secured lenders to extend the maturity of their term and revolving credit facilities through 2016 in exchange for a cash pay down and stock in the reorganized company. The company’s unsecured subordinated noteholders will receive stock representing the remaining 92.5% of the economic and voting interest in the reorganized company in exchange for their existing notes. Other unsecured creditors, such as trade vendors, will be paid in full under the prepackaged plan. As a result of its restructuring, Otelco was able to significantly delever and cut its long term debt from $271 million to $135 million.
Otelco provides telecommunications services to various rural areas throughout Alabama, Maine, Massachusetts, Missouri, Vermont and West Virginia, and operates two competitive local exchange carriers throughout areas of Maine, New Hampshire and western Massachusetts. Willkie is representing Otelco and its affiliates in their chapter 11 cases.
The matter is being handled by partner Rachel Strickland, and associates Jennifer Hardy, Richard Kurdziel and Jack Tracy.