Frontier received final approval for its exit from bankruptcy today. The California Public Utilities Commission was the last remaining approval needed, setting up the company’s exit from bankruptcy in the “coming weeks.”
Frontier filed for bankruptcy just about a year ago in April 2020. The company’s bankruptcy plan was approved by the U.S. Bankruptcy Court for the Southern District of New York in August 2020. That plan would allow the company to reduce its massive debt by $10 billion.
Much of Frontier’s debt came from high profile acquisitions of Verizon network assets. The company also outlined that a lack of investment in fiber network assets forced the company to depend too much on legacy DSL services, which have taken a beating from hungry cable competitors.
At the time of its bankruptcy filing, Frontier reported that over half of its revenues (51%) came from residential services, and most customers were DSL based. The carrier passed some 14 million homes across its footprint, but 11 million could only access DSL. Sixty-five percent of those homes passed could only get speeds of 24 Mbps or less.
Frontier has promised to emerge with a renewed focus on fiber broadband. Back in December 2020, Frontier reported 5 straight quarters of fiber broadband growth and also has secured $371 million in RDOF proceeds to extend broadband to rural markets.
A new CEO, Nick Jeffery, formerly of Vodaphone UK, has taken over.
Frontier probably had to accept some significant concessions for that California approval. There were negotiations at one point that included Frontier agreeing to a $1.75 billion investment in its California network that would grow its fiber footprint there by 350K locations.
All other states have approved the Frontier bankruptcy exit plan, as has the FCC. In a statement today, the company says it will fully emerge from bankruptcy in the coming weeks.