Charter decision sets group precedent for US bankruptcies

Author: Nicholas Pettifer | Published: 2 Dec 2009

A court decision in Charter Communications’ bankruptcy proceeding has set an important precedent as to what constitutes a group under section 13(d) of the Securities Exchange Act. This will make it easier for other companies to retain debt they can afford under their original terms.

Following a decision in the United States Bankruptcy Court Southern District of New York, Charter Communications successfully reinstated $12 billion of its $22 billion debt complete with the favourable terms it was issued on in 2007. It has also written off $8 billion of debt and raised $1.6 billion of new equity through a rights issue.

“The ruling will be cited over and over again,” said Jay Goffman, head of corporate...