NEW YORK Aug 22 (Reuters) - Broadview Networks Holdings Inc. , a communications and information technology provider/operator, filed for a pre-packaged Chapter 11 bankruptcy on Wednesday.
The company, headquartered in Rye Brook, N.Y., filed papers in U.S. Bankruptcy Court in Manhattan listing $258.3 million in assets at the end of the first quarter and $373.4 million in liabilities.
The pre-packaged Chapter 11 bankruptcy application is agreed among creditors and shareholders before the document is filed, and is designed to reduce the time needed for the applicant’s financial re-organization.
The company had been exploring merger, refinancing and restructuring options during the last 18 months in an effort to have enough capital by the time $300 million in senior secured notes matured Sept. 1, CEO Michael Robinson said in a declaration filed in court.
But due to “macro-economic trends and trends specific toindustry,” neither new financing or a sale occurred in time, he said.
Broadview said in a statement on Wednesday the pre-packaged plan would enable the company to eliminate half its debt.
“With a more appropriate capital structure to support our strategic plan and business objectives, we will have greater financial flexibility and liquidity to pursue cloud-based growth opportunities,” Broadview said in the statement.
Broadview is seeking court approval of $25 million in debtor-in-possession financing. The company said it anticipates finishing its restructuring by the end of 2012.
“We feel optimistic it will be a very steam lined restructuring,” said Rachel Strickland, a lawyer for Broadview at Willie Farr & Gallagher.
Ever core Group LLC is acting as financial adviser to Broadview. Dechert and FTI Consulting are advising an ad hoc group of noteholders.
The case is In re Broadview Networks Holdings Inc., U.S. Bankruptcy Court for the Southern District of New York, 12-13579