http://www.kccllc.net/windstream/document/1922312200430000000000001
Windstream analyzed which scenario returned more money to creditors:
• Liquidating the company
• Continuing to operate the company with much lower debt obligations
They concluded the creditors got more money back not liquidating the company.
Interestingly, they show the company continuing its current operations in the CLEC business.
UNIT was financial engineering that was grandfathered in and is no longer allowed by SEC rules. REITs were not designed for the purposes TT put fourth. UNIT/ILEC will fold into the same business unit.
Take a look at the wall street analysts and the 10-k filings. There is no where to go but down.
We are going to circle the drain through 2026 according to our CFO based on our free cash flow.
Tell me why I am wrong we won't hit chapter 7 by August?
https://seekingalpha.com/article/4342270-why-windstreams-reorganization-will-not-solve-unitis-problems
There is also a STRONG possibility that Elliot management will fold in FTR wireline business into the same private equity holdings. Elliot and KCC are also managing frontier communications chapter 11.
Frontier is in worse financial pressure than WIN and will likely face chapter 7 sometime in the next year. The ILEC businesses is fractured and has no future.
@+14JP6kWz (Blankrupt)
Your analysis is very interesting.
One question: could Uniti buy Windstream and operate it? Uniti is a REIT (real estate investment trust); there are special rules on what they are and are not allowed to do.
@OP+14JP6kWz
Thanks for sharing this link and providing some insight.
After reading this document it's my understanding that they are going to convert the chapter 11 to chapter 7 to liquidate as of August 31st. Based on the previous documents on KCC and a review of the hours spent by A&M and other consultants I think they realize that liquidation is the only answer.
I would imagine it's going to look something like a goal line stand down the the last second we ice the kicker and call a time out with 1 second on the clock(August 21st). The next day we will announce chapter 7 and the plan going forward.
Sales of ILEC:
The likely outcome is the sale of Kinetic(ILEC) as a wash
to UNIT. The projected fire sale of the rest of the assets looks
like 20% of the given valuation on WIN.
Sales of non-ILEC:
Given the fractured nature of consolidating all of the CLEC assets it will be closer
to 10%.
Sale of Enterprise (WE): Carrier / wholesale bandwidth and dark fiber becomes a grey
area considering the lease back situation of UNIT. This may be part of the bundled
business unit with Kinetic.
Other miscellaneous assets:
Products and services like fixed wireless, ISG products and support for managed routers, Avaya, Allworx, etc. will be easier to spin off. I would expect this sooner than later. Q2 earnings call and beyond.
While the ship is on fire it's going to take some time to try and unwind all of that
spaghetti. I'm sure all of these MBA's will tell you 6-12 months and that is more like 2 years.
In the mean time LOTS of customers out of service, installs take 2-3 months, and customer
disconnect through the roof!
Windstream Q1 earnings call is scheduled for May 10th
sometime between now and then March operating report
will be released. I'm sure we lost another $40 this month
we will still run out of cash in July. I would think they
will exercise the $500M Citi credit revolver to keep the
company solvent through Chapter 7. Citi will get 100% of their
cash back first and first lien will get 20%.
I think they mean they are selling everything to uniti fiber
That's interesting, CLEC has no future. We just let most of the support teams go that managed those networks. I don't see from a business perspective how it makes sense to maintain that customer base.