MFN gets another chance

Metromedia Fiber Network has received yet another reprieve in its deadline to raise the funding it needs to stay afloat.

The commitment of $235 million in vendor financing MFN received in August was set to expire yesterday because the company did not secure other funding and cash-flow commitments. But those providing the vendor financing now have given MFN until Sept. 12 to close these other sources of funding.

Those sources include $230 million of convertible notes for which MFN has already receive commitments and a $150 million note facility led by Citicorp, the agreement for which has been signed but not closes. In addition, MFN must get permission to defer payments to certain vendors.

MFN, which has received a series of extensions during the past five weeks related to its various fund-raising efforts, also stated that it will seek bankruptcy protection should the funding not materialize. In addition, should the funding be secured, current stockholder value will be “significantly diluted,” according to a company statement.

--Toby Weber, staff writer