VarTec Telecom gets court OK to sell remaining assets to Comtel for $82.1 million

By Caroline Salls

Pittsburgh, July 29 - VarTec Telecom Inc. obtained approval to sell all its remaining assets to Comtel Investments LLC for $82.1 million, according to a Friday filing with the U.S. Bankruptcy Court for the Northern District of Texas.

Leucadia National Corp. was the stalking horse bidder under a $61.5 million purchase agreement for the auction held Monday. Since Leucadia was not the successful bidder, VarTec will pay it a termination fee of 3% of the purchase price.

The sale will be a three-step process.

First, VarTec and the buyer will enter into a management services agreement, under which the buyer will agree to operate VarTec's acquired assets pending closing of the sale.

Second, after the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, VarTec will transfer all acquired assets for which Federal Communications Commission consents are unnecessary. At that time, VarTec will receive 50% of the purchase price.

Finally, after FCC consents are obtained, those assets will be transferred and VarTec will receive the remainder of the purchase price.

VarTec, a Dallas-based telecommunications provider, filed for bankruptcy on Nov. 1, 2004. Its Chapter 11 case number is 04-81694.

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