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Ist schon heftig: Heute meldet COVAD erst mal Konkurs an und die Aktie explodiert förmlich. Aber bei genauerer Betrachtung der Meldung kann man es schon verstehen. Covad to File for Bankruptcy TUESDAY, AUGUST 07, 2001 1:42 PM - Associated Press SAN JOSE, Calif., Aug 07, 2001 (AP Online via COMTEX) -- Troubled high-speed Internet provider Covad Communications Group Inc. said Tuesday it plans to file for bankruptcy protection as part of a deal with bondholders that would wipe out $1.4 billion in debt. Once negotiations are complete and paperwork filed by mid-August, Covad will become the third independent provider of Digital Subscriber Line service - and the largest - to land in bankruptcy court this year. In Covad`s case, the Chapter 11 bankruptcy is not expected to affect operations or any of its 330,000 subscribers, said Charles Hoffman, president and chief executive officer. The prenegotiated bankruptcy will only affect bondholders and is designed to make the company more attractive to investors, he said. "Basically, we`ll be a debt-free company," Hoffman said. "For potential investors, here`s a company that`s growing nicely and cutting expenses. It`s quite an attractive investment." Last week, Rhythms NetConnections Inc. filed for bankruptcy and warned that it may not be able to sustain its business. Earlier this year, the assets of bankrupt NorthPoint Communications were sold to AT&T for $135 million. All the companies sought to deliver fast, always-on Internet service over regular phone lines. But they ended up in trouble as capital grew scarce and Wall Street began valuing profit over growth. The independent DSL providers also were crunched by stiff competition from traditional telephone companies, which sold their own cheaper service to consumers and leased networks to their competitors. Unlike the death knells sounded by NorthPoint and Rhythms at the time of their bankruptcies, Covad officials described their planned filing as good news. "We`re a lot larger, with a lot more cash and great partners throughout the country," Hoffman said. "The other key factor is we did this well in advance of hitting a wall." Covad said bondholders carrying a majority of the company`s debt have agreed in writing or verbally to the deal. Bondholders would exchange their bonds for a combination of cash and preferred stock. The cash portion would consist of 19 cents on the dollar for the value of both high-yield and convertible bonds. The preferred stock would represent about 15 percent of all the company`s shares. When the transaction closes, Covad expects to pay $283.3 million to bondholders, leaving the company with about $250 million in cash - enough to fund operations into the beginning of 2002. "Covad will be in a much stronger position going forward, with no debt and a much smaller cash requirement," Hoffman said. The company predicted it will need about $200 million more in cash to carry it through to profitability, which is expected to occur by the third quarter 2003. In its last financial statement covering the three months ended March 31, Covad lost $198.5 million, or $1.15 per share, compared to a loss of $136.3 million, or 93 cents per share, in the year-ago period. But revenue more than tripled, to $71.2 million from $20.8 million. Shares of Covad were up 13 cents, to 63 cents, in Tuesday trading on the OTC bulletin board. The company was delisted from the Nasdaq Stock Market as of July 20 for failing to maintain the minimum share price ----------------------------------------- Also hoffen wir das Beste. V.Mac |
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| aus der Diskussion: | Covad Communications, jetzt ist es peinlich !! |
| Autor (Datum des Eintrages): | V.Mac (07.08.01 20:31:40) |
| Beitrag: | 7 von 12 (ID:4150420) |
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