Charter Files For "Prearranged Bankruptcy" 82
jamie points out news that Charter Communications filed for "prearranged" Chapter 11 bankruptcy on Friday, primarily to reorganize some of the $21.7 billion in debt it has accrued. Quoting:
"The St. Louis-based company seeks to emerge from bankruptcy as early as the end of summer and doesn't plan on selling any of its assets to competitors. After Chapter 11, interest costs at Charter, which has never posted a profit since going public in 1999 due to massive debt interest payments, will be cut in half to $830 million a year. The filing restructures about $8 billion of debt at Charter, which is controlled by Microsoft Corp. co-founder Paul Allen, but leaves about $13 billion of debt on its books. Allen will control 35 percent of the votes in the reorganized company. In the bankruptcy, Allen's 51 percent equity stake in the cable operator will be wiped out, along with shares of other stockholders. Allen also holds some debt and preferred stock."
Maybe Obama can just bail them out? (Score:0, Insightful)
How much free mney do they need? $25 billion? Heck, let's be safe and give them 10x that... $250 billion.
13 billion!!!! (Score:1, Insightful)
How can a company be allowed to get 13 BILLION into debt!
Re:Could it be their service? (Score:5, Insightful)
She even went up to the Charter office, and the girl that she talked to there actually said she was telling customers to get satellite. So that's what my grandmother did. She'd been a Charter customer literally since they became available in her area, even before they ever went public. Decades. Not anymore. She's a happy DirecTV customer now, with all her HDTV and her DVR. Loving it.
She got AT&T DSL too, not the greatest choice but it's pleased her.
Looking around at all the other dishes in the area (a lot of them are DISH network, I notice, which is owned by AT&T, so probably a lot of DSL customers too), it's not at all hard to see that Charter is hemorrhaging customers in that market, and I have little doubt that it is by far not the only place where they're making such stupid, asinine decisions that are forcing customers to leave them in order to get the service they clearly want.
They're not all bad (Score:3, Insightful)
I know a lot of comments here are going to be about their horrible customer service, unreliable network problems, etc. I know cause I've heard a lot of friends' (in St. Louis, where I live) horror stories. Maybe I'm the only customer that has been pleased with their services. Calling customer service has always been surprisingly pleasant and my issues resolved impressively quickly.
AT&T's U-verse just became available in my area (when I moved here cable was the only option for high-speed internet, DSL didn't reach this far) but I really do not want to deal with the pain of switching my TV, DVR, internet and phone over to a different company. I already give AT&T too much money each month for my cell phone.
Charter has done good by me (so far), they're a local company and I hope they come out of this stronger. Options and competition are a good thing for the kinds of services they offer.
Re:13 billion!!!! (Score:4, Insightful)
how can the federal reserve system be allowed to run a 10 trillion dollar + pyramid scheme?
Re:Maybe Obama can just bail them out? (Score:3, Insightful)
Unfortunately, as the auto industry found out, you need to have Obama's friends working in your industry in order to qualify.
Re:13 billion!!!! (Score:5, Insightful)
Because our brand of capitalism is based on borrowed money.
Just about every company who employs more than 100 people is borrowing money daily in the commercial paper market just to pay its vendors and employees.
That, coupled with the notion that there has to be constant, accelerating growth, that having a company that makes a profit and employs people that are happy just isn't enough, and you get a system that's made of borrowed money and workers who are exploited.
One bright spot in this recent economic turmoil is that more people are learning a lot of surprising things about the way our "free-market capitalist" system really works. More of them are realizing that it's not "the immigrants" or "the blacks" or "Wall Street" or even "the government" that is destroying our way of life, it's something a lot more systemic.
Re:Liquidate the entire damned company! (Score:3, Insightful)
The more companies that drop out of a particular market, the more the remaining companies will try to screw you.
Look for a massive hike in price at Comcast in the coming months. Either a price hike, tightening of the bandwidth cap, both, or something else that shows how important competition is.