Global cloud networking provider, GTT Communications announced that it has entered into a Restructuring Support Agreement with key stakeholders, including holders of a majority of its secured and unsecured debt and I Squared Capital. The company aims to implement a comprehensive restructuring of the company’s remaining balance sheet following the completion of the pending sale of its infrastructure division.
Reducing debt by $2.8 billion
The company stated that the combination of the infrastructure division sale and the transactions contemplated by the RSA will reduce the company’s debt by approximately $2.8 billion. With the agreement, GTT will improve its capital structure and execute its long-term business strategy. The company also expects to expeditiously close the sale of its infrastructure division to I Squared Capital in the coming weeks.
After the sale of the division, GTT and subsidiaries intend to commence prepackaged chapter 11 cases in the U.S. Bankruptcy Court for the Southern District of New York to effectuate a deleveraging of GTT’s post-sale capital structure. The company’s foreign businesses and operations outside of the U.S. are not included and will be unaffected by the case. Ernie Ortega, Chief Executive Officer of GTT said,
“This global agreement among each of our creditor constituencies resulted from extensive negotiations and reflects the ongoing commitment of our debtholders to the business. Our performance has been strong year-to-date, and we have a very competitive product portfolio in growing segments of the market, such as SD-WAN. To continue this momentum, we are working together with our debtholders to improve GTT’s financial health and this is a major milestone to accomplish this goal.
I would like to thank our GTT team for continuing to deliver outstanding services to our valued clients and our Board of Directors for its steadfast support. I would also like to express my utmost gratitude to our customers and valued partners around the globe with whom we are honored to work.”