Adelphia Misses $55.5M Bond Bills
Jun. 17, 2002
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PHILADELPHIA (AP) _ Adelphia Communications Corp. said it missed making a $51.3 million bond interest payment Monday. Analysts said pressure was growing for the struggling cable television company to file for bankruptcy.
Adelphia also announced that a subsidiary, Arahova Communications Inc., missed a $4.2 million bond interest payment Monday.
``Adelphia will likely need to file for Chapter 11 bankruptcy protection by the end of this week,'' UBS Warburg analyst Aryeh Bourkoff said.
A grace period for the interest payments ended on Saturday.
``We believe that the grace period for this payment officially expires tonight, when the company would be in default of its coupon payments,'' Bourkoff said in a client note Monday.
The defaults would give bondholders the power to force the company into bankruptcy. Adelphia officials wouldn't comment on the likelihood or the likely timing of a bankruptcy filing, spokesman Eric Andrus said.
Besides missing debt payments, the company still hasn't filed its annual 10-K financial statement, due April 1, as it tries to sort out off-the-books borrowing arrangements by the family of founder John J. Rigas for which the company may bear liability. The company has said such debts may amount to more than $3 billion, and the Rigases have left executive posts and board seats at the company.
Adelphia has said it expects to have to restate three years of financial results to show the debts as liabilities, and has disclosed that its subscriber totals and cash flow figures were overstated. The company fired Deloitte & Touche as its accountant June 9, naming PricewaterhouseCoopers as a replacement on Friday.
Adelphia's stock, delisted by the Nasdaq Stock Exchange for failure to file financial reports, was at 17 cents a share in over-the-counter trading Monday, having plunged from $20.39 a share before the company first disclosed the off-the-books debt in March.
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