Hawaiian Telcom emerges from Chapter 11 with $300 million of debt

By Jennifer Chiou

New York, Oct. 28 - Hawaiian Telcom Communications, Inc. announced that it successfully completed its reorganization and has emerged from Chapter 11 after having received court approval on Wednesday to make "immaterial modifications" to its plan of reorganization.

Through its reorganization, Hawaiian Telcom said it has reduced its debt by over $850 million, or about 74%, emerging with $300 million of debt.

The U.S. Bankruptcy Court for the District of Hawaii approved the company's plan, effective Thursday, while the Federal Communications Commission and the Hawaii Public Utilities Commission gave the go-ahead to the company's new ownership and capital structure.

"As was our goal, we have significantly reduced our debt through the Chapter 11 process and have emerged a much stronger, more financially secure company better positioned to address the growth opportunities as the leading communications provider in the Hawaii marketplace," president and chief executive officer Eric K. Yeaman said in a news release.

As already reported, the company specifically amended its new term loan to give Hawaiian Telcom the right to consent to or request the holders of the new term loan to consent to a debt-for-equity exchange.

In addition, the plan and plan confirmation order was amended to increase the number of shares under the company's certificate of incorporation to 250 million from 20 million. This includes 245 million shares of common stock and 5 million shares of preferred stock.

Hawaiian Telcom, Inc., a Honolulu-based telecommunications provider, filed for bankruptcy on Dec. 1, 2008 in the U.S. Bankruptcy Court for the District of Delaware. The case was later transferred to Hawaii. The company's Chapter 11 case number is 08-02005.

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