Teligent at impasse with creditors, seeks conversion to Chapter 7

By Sarah Lizee

Olympia, Wash., Feb. 24 – Teligent, Inc. asked the U.S. Bankruptcy Court for the District of Delaware to convert its Chapter 11 cases to Chapter 7, according to a motion filed Wednesday.

The company said that while its sale process was successful, resulting in three separate transactions and nearly $88 million in sale proceeds, discussions between the debtors, the official committee of unsecured creditors and the prepetition secured lenders have reached an impasse.

As a result, and without the consensual use of cash collateral to fund a Chapter 11 plan process, the company said it has no choice but to request the conversion.

“The debtors made every effort to negotiate in good faith concerning the wind-down of the debtors’ estates and a consensual exit from Chapter 11 given the debtors’ capital structure and the economic realities of the Chapter 11 cases,” the company said in its motion.

“While the debtors’ decision is regrettable, they nonetheless believe that conversion of the Chapter 11 cases to Chapter 7 is the only path forward in light of the impasse and without use of cash collateral to fund a Chapter 11 plan confirmation process.”

A hearing is slated for March 9.

Teligent is a Buena, N.J.-based specialty generic pharmaceutical company. The company filed bankruptcy on Oct. 14 under Chapter 11 case number 21-11332.

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