Teligent set to emerge from bankruptcy

Fixed wireless broadband provider Teligent will emerge from bankruptcy debt-free and fully funded some time around Sept. 16. The Herndon, Va.-based provider said it will have all of its existing fixed wireless assets intact, including spectrum licenses in 74 U.S. markets.

The re-emergence comes after the U.S. Bankruptcy Court for Southern New York yesterday approved a reorginazation plan that called for Teligent to provide transport service to carriers, point-to-point broadband access services to multi-location businesses and dedicated Internet connectivity to enterprise companies, the company said.

The company’s senior secured lenders will own 100% of the stock of the newly structured company, which will be operated by the existing management team.

“This has been an incredible journey,” said Jim Continenza, Teligent’s CEO.

Teligent declared Chapter 11 bankruptcy May 21, 2001, after which it went through a convoluted series of events that included a potential buyout by IDT and rumors that either WorldCom or Verizon would step in and pick up the pieces. When none of that happened, Teligent management attempted its own restructuring, but, after the financial markets crashed post-Sept. 11, that plan fell by the wayside. As late as last December it seemed probable that the company would be dissolved and the pieces sold.

“We were able to pull it out and find the right business, show these are the right people [and] we just have to make some changes,” said Continenza.

The reorganization plan placed before the banks resembled the management-led proposal but dropped the idea of retail services while focusing on leveraging the fixed wireless wholesale applications. The bankers approved, offered their support, and Teligent issued a press release Jan. 23. The matter has been in the courts until yesterday’s decision. “They [bankers] saw more equity in putting additional money in the company and running it than they did in turning it off,” said Continenza. “We, as a company, didn’t think it was the right thing to have debt on our books. We wanted to be debt-free and they concurred.”