FairPoint appears to be making some progress towards a recovery as U.S. Bankruptcy Judge Burton Lifland in New York late last week approved the troubled service provider's reorganization plan and a $75 million loan to pay for its exit out of Chapter 11 protection.
Under FairPoint's amended restructuring plan, the company would give holders of secured debt 92 percent of the shares when the company emerges from Chapter 11 protection, while unsecured creditors would get eight percent of the shares.
Still, FairPoint is far from being out of the woods. Not only does the telco have to go through a confirmation hearing this May, it also faces objections from Verizon Communications and Comcast--both questioning how its proposed settlements with creditors impact telecom service and agreements in the New England region.
"I cannot find this plan patently unconfirmable," Lifland said adding that objections could be addressed during the confirmation hearing.
- Bloomberg has this article
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