Windstream Bankruptcy a 'Potential Response' After Court Defeat
A $310 million judgment against the communications giant was "disappointing, and frankly surprising."
Could Windstream be facing bankruptcy?
The U.S. District Court of the Southern District of New York on Friday ruled in favor of Aurelius Capital Management, a Windstream bondholder, saying the communication giant’s 2015 spinoff of copper and fiber assets into the Uniti Group real estate investment trust (REIT) breached their contract.
The court ruled that Aurelius is entitled to a money judgment of nearly $310.5 million, plus interest after July 23, 2018.
dBrn’s Michael Finneran
“If the wireline carrier business didn’t have enough problems already … from the sound of things, Windstream got overly creative in structuring that bond deal and now has to ‘pay the piper,'” said Channel Partners contributor Michael Finneran of dBrn Associates.
The decision arose from challenges by Aurelius and U.S. Bank National Association that the spinoff was invalid under the terms of those agreements.
“We are disappointed in, and frankly surprised by, the ruling and will be taking immediate steps to pursue all available options, including post-trial motions and an appeal,” said Tony Thomas, Windstream