Citing “people with knowledge of the matter,” Bloomberg News reported Jan. 16 that Frontier Communications Corp., which operates in 29 states including southeastern Utah, was looking to craft a deal that would include filing for bankruptcy, setting in motion what could be one of the largest telecommunications company reorganizations since 2002.
The restructuring is unlikely to impact customers with existing service, according to officials, and a spokesperson for Frontier said that serving customers “remains our top priority.” Restructuring deals typically involve a Chapter 11 bankruptcy filing; Frontier making such a deal would mean no interruption of telephone and broadband service for its customers.
The spokesperson, Javier Mendoza, the company’s vice president for Corporate Communications and External Affairs, said that “Frontier is evaluating its capital structure with an eye to reducing debt,” with the ultimate goal of providing better service to customers.
“Our customers should expect no changes as we remain focused on providing connectivity services without interruption to our residential customers, institutions and businesses,” Mendoza said.
As The T-I reported previously, Frontier faces dire financial straits with large debt maturities looming over the coming two years. The corporation has reached a deal to sell off operations in Washington, Oregon and Montana to keep pace with the liabilities, and its stock price has dropped 99% over the past 10 years as financial analysts give it a solid sell rating.
Amid the financial distress, Frontier also faces investigations by multiple public entities, including the State of Utah’s Public Services Commission, which has been looking into complaints from out of Castle Valley and the surrounding area regarding the reliability of Frontier’s telephone services. An official update on the investigation was expected after The Times-Independent went to press Wednesday, Jan. 22.
A spokesperson for Utah’s Division of Public Services told The T-I previously that she expected a Frontier bankruptcy would leave its operations in the state “largely unaffected,” and that its Utah operations have, in fact, been “profitable.”
“We believe Frontier’s service territory and Utah’s rural telecommunications systems and governance are well-suited to the provision of robust and reliable service with reasonable investor profits,” Price said. “The Division will continue to pursue safe, adequate, and reliable service at reasonable rates.”