Starry files for bankruptcy
Starry Group Holdings, Inc., a licensed fixed wireless technology developer and internet service provider, and its U.S. affiliates and subsidiaries announced that they have filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware and have entered into a Restructuring Support Agreement with lenders holding the Company’s debt.
The RSA contains agreed-upon terms for a pre-packaged financial restructuring plan (the “Plan”) that is expected to significantly reduce the Company’s debt, optimize the Company’s capital structure and liquidity, and ultimately, better position Starry for success. Starry’s customer and network operations during this restructuring process will continue as normal within its five core operating markets: Boston, New York City, Los Angeles, Denver and Washington, DC. The Company plans to move swiftly through the restructuring process.
“Over the last several months, we’ve taken steps to conserve capital and reduce costs in order to put Starry in the best position to explore various financing paths for the company,” said Chet Kanojia, Starry’s Chief Executive Officer. “Our next step in this journey is to continue to strengthen our balance sheet through a Chapter 11 restructuring process.”
Kanojia added, “With the support of our lenders, we feel confident in our ability to successfully exit this process as a stronger company, well-positioned to continue delivering an affordable, high-quality broadband experience to our customers. The Restructuring Support Agreement provides us with the funding needed to continue operating as normal, through this restructuring process and as we guide the company to profitability. We have a strong and experienced team in place and look forward to moving through this process quickly so that we can continue expanding essential broadband access and #HappyInterneting to more communities across the country.”
The Company has filed various “first day” motions with the Court requesting customary relief, including a motion for approval of a $43 million debtor-in-possession (“DIP”) financing facility that is expected to provide Starry with the necessary liquidity to continue its normal business operations and meet its post-filing obligations to its employees, customers and vendors.
Pursuant to the RSA, the Company anticipates closing on a debt-for-equity restructuring with the lenders but will first conduct a marketing and auction process to identify any other potential bidders for its business. Starry has filed motions seeking Court approval of bidding and auction procedures.
Starry Will Continue to Operate as Normal
Starry will continue to serve existing and new customers in its five core markets, delivering affordable, high-speed broadband services across communities in Boston, New York City, Los Angeles, Denver and Washington, DC. Starry’s transparent and simple ‘no tricks’ pricing and world-class customer care will continue to be foundational elements of the customer experience that has distinguished the company as a leader in customer satisfaction among internet service providers. Starry ended 2022 with an average 61 NPS. Additionally, Starry will continue to support and expand access to its digital equity program, Starry Connect, which specifically serves consumers living in public and affordable housing communities, and will continue to make available the federal government’s Affordable Connectivity Program benefit to eligible households.
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