Frontier may soon exit bankruptcy, with news that the FCC has approved the company’s restructuring plan. Frontier now has approval from 13 states and reports it will emerge from Chapter 11 in “early 2021.”
Frontier needs approvals from 4 additional states to complete its exit from bankruptcy. The U.S. Bankruptcy Court for the Southern District of New York confirmed Frontier’s reorganization plan in August 2020. That plan reduces Frontier’s debt by about $10 billion. The company also recently appointed a new CEO to manage its post-bankruptcy plan.
“We continue to make important progress in our constructive engagement with regulators across our service territories, and this approval from the FCC marks a major milestone,” said Bernie Han, President and Chief Executive Officer in a press release. “We continue to await approval in just four states and are working to expedite those approvals to enable the Company to emerge from Chapter 11.”
Frontier is making concessions to get those state approvals to exit bankruptcy. To gain California’s approval, Frontier had to commit to spend $1.75 billion in network improvements and bring fiber to 350K additional locations.
Frontier also recently won sizable RDOF funding, to the tune of $371 million. Most of those funds, $247 million, are earmarked to build broadband to 79K locations in West Virginia. The company is getting some scrutiny about its ability to deliver in that state though.
Frontier says it will transform itself to be a leading FTTP provider once it exits bankruptcy. It will have its work cut out for it to accomplish that goal. When it entered bankruptcy, the company reported that 11 million of the 14 million homes it passed had access to DSL only.