Otelco Inc. (OTT,OTT_UN.TO), a wireline telecommunication services provider, announced that on March 24, 2013, it filed voluntary petitions for reorganization under chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware.
The company stated that it filed for chapter 11 in order to implement its "pre-packaged" financial restructuring plan - a plan that already has been accepted by 100% of the Company's senior lenders, as well as holders of over 96% in dollar amount of Otelco's senior subordinated notes who cast ballots.
The company noted that the restructuring plan will strengthen the Company by deleveraging its balance sheet and reducing its overall indebtedness by approximately $135 million.
In addition, the company added that it will maintain normal day-to-day business operations and continue to provide its customers with quality services throughout the restructuring. The company's plan provides for suppliers and vendors to be paid in full during and after the restructuring process and for employees to continue to receive their usual pay and benefits.
The company anticipates that it will be able to complete its financial restructuring at the end of the second quarter of 2013.
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