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Business Briefing / Cable Tv

Bankruptcy erases Allen's Charter stake

February 14, 2009|Times Wire Reports

Microsoft co-founder Paul Allen will see his majority stake in struggling cable operator Charter Communications Inc. wiped out in a pre-arranged bankruptcy, but a deal with his debt holders will give him a 35% voting control in the newly reorganized company.

The chairman of St. Louis-based Charter also will get the right to nominate at least 35% of the board, according to filings with the Securities and Exchange Commission late Friday.

On Thursday, Charter disclosed that it expected to file for bankruptcy by April 1 and get relief from creditors. Holders of $8 billion of debt agreed to swap their debt for nearly complete ownership in the new company, and certain old debt was exchanged for new debt.

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