Mpower files prepackaged Chapter 11

New York, April 8 - Mpower Holding Corp. made a prepackaged Chapter 11 filing in the U.S. Bankruptcy Court for the District of Delaware.

The Rochester, N.Y. broadband communications company said its proposed restructuring will cut its debt and preferred stock by $583.4 million - along with $50 million in annual interest expense and $15 million in annual dividend payments - in exchange for $19 million in cash and additional shares of common stock. The $19 million was distributed to eligible holders of the 2010 senior notes on March 28. After the proposed restructuring, Mpower said it will have less than $50 million of debt.

The filing covers both the parent company and its Mpower Communications Corp. and Mpower Lease Corp. subsidiaries.

"With the support of a majority of our debt holders and preferred stockholders already in place, we believe we are now in a position to efficiently restructure our balance sheet and hope to complete this process as quickly as possible," said Mpower Communications chief executive officer Rolla P. Huff in a news release.

As previously announced, Mpower has reached agreement with 99% of its 2010 senior noteholders and more than two-thirds of its preferred shareholders on the proposed recapitalization.

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