The Federal Communications Commission, mindful of the rural services that Windstream Holdings provides — and the federal universal service funds that it receives — says it will be watching closely as the company proceeds with Chapter 11 bankruptcy.
Windstream recently filed for bankruptcy protection after a court decision which found that Windstream violated agreements with its bondholders when it spun off network assets into a real estate investment trust in 2015. The finding essentially pushed the company went into default after accelerated maturity of debts, according to Windstream.
“Windstream did not arrive in Chapter 11 due to operational failures and currently does not anticipate the need to restructure material operations,” said Tony Thomas, president and CEO of Windstream. The company also noted that it has received a commitment from Citigroup for $1 billion in debtor-in-possession financing, and it has made a number of court filings to allow it to continue normal operations.
Kris Monteith, chief of the FCC’s Wireline Competition Bureau, issued a statement saying although he is “pleased that Windstream has made clear that its reorganization in bankruptcy will not disrupt service to any consumers,” that “nonetheless, we must be vigilant in light of these events to ensure that the lifesaving 911 service and the voice and broadband connections that Windstream’s customers rely upon remain—and that the federal funds that Windstream receives through the Connect America Fund and other universal service programs are put to their appropriate use to connect rural and low-income Americans with high-speed broadband.”
Commissioner Geoffrey Starks, the newest member of the FCC, said in a statement that is it “concerning when one of the nation’s largest internet and voice service providers files for bankruptcy” and that since the company provides 911 services, among others, that he “will be monitoring the situation closely to ensure that there are no disruptions.
“Windstream also provides broadband service to over 1 million customers across the U.S. and it is essential that their interests are represented and protected as the company reorganizes. I will also be watching to ensure that Windstream makes proper use of the millions of dollars in Universal Service funding it receives and that it meets all broadband connectivity and other commitments related to that funding. I’m sure that this process is unsettling for Windstream’s customers and employees, so I am glad that Windstream took immediate steps to ensure that it can continue to operate,” Starks said.
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