Charter Communications, the cable TV company in which Microsoft co-founder Paul Allen owns a controlling stake, is attempting to negotiate with its bondholders to alter debt financing to help the company navigate through financial challenges. Though the company showed revenue and subscriber gains during the third quarter and has been among the leading DOCSIS 3.0 pioneers, it is also heavily leveraged with about $21 billion in debt. About $7.1 billion of that debt comes due within the next five years.
A mountain of debt may be nothing new to a company built through acquisitions, but with the debt crisis alive and well, investors may show little patience, and companies are becoming more sensitive about exploring various financial options earlier than they normally would. For Charter, that likely means debt restructuring or possibly a deal in which some of the debt is converted to stock.
Charter has been on thin ice before, and the company actually considered a sale or privatization at one point last year. Could the company return to the idea of selling itself, or parts?
- The Wall Street Journal reports
Charter looked to be exploring a sale in August 2007
Charter started 2008 on a more positive note