Otelco Goes Chapter 11

Wireline provider Otelco Inc., serving Alabama, Maine, Massachusetts, Missouri, New Hampshire, Vermont and West Virginia, filed voluntary Chapter 11 petitions in the U.S. Bankruptcy Court for the District of Delaware. The carrier will implement its “pre-packaged” financial restructuring plan – a plan accepted by 100 percent of Otelco’s senior lenders along with holders of more than 96 percent (in dollars) of Otelco’s senior subordinated notes. Otelco says the restructuring plan will strengthen the company “by deleveraging its balance sheet and reducing its overall indebtedness by approximately $135 million.” According to the filings, service will continue as usual, staffers will receive pay and benefits, and suppliers and vendors will be paid in full during and after the restructuring process.