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RCNC Message Board

  • elyfrank elyfrank Feb 17, 2004 2:42 PM Flag

    Short Covering?

    <EOM>

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    • DJ RCN To File For Bankruptcy To Stay In Cable Business

      02/17/2004
      Dow Jones News Services
      (Copyright � 2004 Dow Jones & Company, Inc.)



      PRINCETON, N.J. (AP)--Struggling cable company RCN Corp. (RCNC) said it will file for bankruptcy as part of a strategy to attract new investors and stay in the business of bundling cable television, Internet and telephone service.

      "We anticipate filing Chapter 11 in order to consummate a deal," Barak Bar-Cohen, an RCN spokesman, said Tuesday.

      Managers of Princeton-based RCN hope to swap $1.7 billion in debt for a share in the company, Bar-Cohen said.

      Bar-Cohen said service to RCN's 436,000 subscribers nationwide will not be disrupted.

      He said the company is negotiating with several potential investors, although he declined to say who they were, and hopes to finalize an equity-for-debt deal before March 1.

      Despite conjecture in recent published reports, Cohen said the company has no plans to sell its Lehigh Valley system, which includes 100,000 subscribers, and it one of the company's most attractive assets. Though such a sale could provide a cash infusion, it would be inconsistent with the company's longer-range plans of attracting new partners and continuing to grow in the highly competitive telecommunications market.

      With only modest growth in sales, steep layoffs have failed to prop up share prices, which have plunged from nearly $75 in early 2000 to under $1. One of RCN's biggest investors, Microsoft (MSFT) co-founder Paul Allen, sold 40% of his shares last month for a loss of about $650 million.

      Even so, on Valentine's Day, RCN Chief Executive David C. McCourt issued a rosy statement on a new Web site, www.rcntomorrow, intended to provide updates on the company's survival plans.

      "Some of our competitors will try to suggest that RCN doesn't have much of a future," the statement read. "Nothing could be further from the truth."


      (END) Dow Jones Newswires

      02-17-04 1442ET










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    • no need to cover on this one.

    • PRINCETON, N.J. (AP)--Struggling cable company RCN Corp. (RCNC) said it will
      file for bankruptcy as part of a strategy to attract new investors and stay in
      the business of bundling cable television, Internet and telephone service.

      "We anticipate filing Chapter 11 in order to consummate a deal," Barak
      Bar-Cohen, an RCN spokesman, said Tuesday.

      Managers of Princeton-based RCN hope to swap $1.7 billion in debt for a share
      in the company, Bar-Cohen said.

      Bar-Cohen said service to RCN's 436,000 subscribers nationwide will not be
      disrupted.

      He said the company is negotiating with several potential investors, although
      he declined to say who they were, and hopes to finalize an equity-for-debt deal
      before March 1.

      Despite conjecture in recent published reports, Cohen said the company has no
      plans to sell its Lehigh Valley system, which includes 100,000 subscribers, and
      it one of the company's most attractive assets. Though such a sale could
      provide a cash infusion, it would be inconsistent with the company's
      longer-range plans of attracting new partners and continuing to grow in the
      highly competitive telecommunications market.

      With only modest growth in sales, steep layoffs have failed to prop up share
      prices, which have plunged from nearly $75 in early 2000 to under $1. One of
      RCN's biggest investors, Microsoft (MSFT) co-founder Paul Allen, sold 40% of
      his shares last month for a loss of about $650 million.

      Even so, on Valentine's Day, RCN Chief Executive David C. McCourt issued a
      rosy statement on a new Web site, www.rcntomorrow, intended to provide updates
      on the company's survival plans.

      "Some of our competitors will try to suggest that RCN doesn't have much of a
      future," the statement read. "Nothing could be further from the truth."


      (END) Dow Jones Newswires

      02-17-04 1442ET

      14:42 021704

 

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