Little Rock Company OK Exit Plan by FCC


The Federal Communications Commission has blessed the private ownership structure proposed by Windstream Holdings Inc., one of the last major approvals the company needs to come out of bankruptcy.

On Friday evening, the commission approved the new ownership of the company and the transfer of unused fiber assets to Uniti Group Inc. under a settlement agreement approved by the federal bankruptcy court in May.

Windstream will come out of bankruptcy protection as a private company owned by its creditors. Elliott Management Corp., a New York hedge fund, will be the largest shareholder, owning around 40% of Windstream. Day-to-day operations will continue to be led by President and CEO Tony Thomas.

The approval was granted to “realize the public interest in facilitating Windstream’s early exit from the bankruptcy process,” the FCC said in its order.

The company is awaiting approval from a handful of state regulatory commissions.

“Windstream is now positioned to exit in the coming weeks of restructuring following the approval of our request by the FCC, which follows our successful exit funding,” Thomas said Monday.

“Windstream will have a strong balance sheet and liquidity position as we emerge to continue investing in our business to drive growth.”

Last week, Windstream raised $ 2.15 billion in debt, consisting of $ 1.4 billion in 7.75% senior notes due 2028 and $ 750 million in 7.75% senior loans. , 25% due 2027. Exit funding also included a $ 500 million revolving line of credit.

In July, the FCC asked the public to comment on Windstream’s request to approve the new ownership group and transfer its dark fiber assets, that is, underground fiber that is not in service, at Uniti. There were no filing opposing the request, the FCC said in its decision Friday.

“The proposed transfer does not present any significant competitive prejudice and is expected to result in a more financially healthy supplier and a stronger competitor to larger integrated suppliers,” said the decision.

As part of the Windstream-Uniti settlement, Uniti will invest up to $ 1.75 billion over 10 years in the fiber network used by Windstream, which in turn will pay approximately $ 650 million per year for this access. The deal also says Uniti will pay Windstream approximately $ 490 million in cash and purchase fiber assets from Windstream for an additional $ 285 million.

Windstream’s restructuring plan, approved by the federal bankruptcy court in June, allows the company to operate as a private entity and reduce its debt by about 50%, or more than $ 4 billion.

In addition to reducing debt, Windstream’s new capital structure strengthens the company’s ability to expand 1 gig fiber broadband service to more than half of the 4 million broadband customers it serves. Only about 7% of these customers today have access to speeds of 1 gig.


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