Amid rising concerns about the burdensome debt accrued by U.S. telecom companies in recent years, many are apprehensive about the increasing strain on corporate finances, particularly with the Federal Reserve continuing its course on hiking interest rates. Given that only a quarter of the overall corporate debt held by U.S. companies is due to mature within the next three years, the potential financial strain is likely to initially impact the most vulnerable segment of the debt spectrum – particularly firms with significant amounts of speculative-grade or “junk” debt, notably prevalent among businesses backed by private equity. This is culminating in an increased risk of bankruptcy for U.S. telecom companies, especially for firms that are unable to manage their debt obligations effectively.
In total, more than 20 major U.S. telecom companies have filed for bankruptcy over the past five years. These companies include Cyxtera, Internap, Starry, Sungard AS, GTT Communications, Intelsat, Frontier Communications, Seaborn Networks, Global Cloud Xchange, Fusion Connect, and Windstream.
Dgtl Infra provides a detailed overview of more than 20 major telecom and digital infrastructure companies that have filed for Chapter 11 and Chapter 7 bankruptcy, both voluntarily and involuntarily, in the United States since 2018. We have refined our list to include only those companies which had at least $100 million in liabilities at the time of filing and have integrated the filings of U.S. subsidiaries of foreign companies into our analysis.
U.S. Telecoms Bankruptcy Filings
|#||Company Name||Infrastructure||Filing Date||Liabilities|
|1||Cyxtera Technologies||Data Centers||6/4/2023||$1.0bn+|
|3||Internap Holding||Data Centers||4/28/2023||$100m-500m|
|4||Starry Group||Fixed Wireless||2/20/2023||$100m-500m|
|5||Core Scientific||Crypto Mining||12/21/2022||$1.19bn|
|6||Compute North||Crypto Mining||9/22/2022||$146.7m|
|8||Sungard Availability Services||Data Centers||4/11/2022||$500m-1.0bn|
|11||Intelsat (Reorganized ISA)||Satellites||5/14/2020||$1.0bn+|
|13||Frontier Communications||Fiber / Copper||4/14/2020||$17.1bn|
|15||Internap Technology||Data Centers||3/16/2020||$100m-500m|
|16||Seaborn Networks||Subsea Cables||12/22/2019||$150.1m|
|17||Global Cloud Xchange (GCX)||Subsea Cables||9/15/2019||$1.0bn+|
|19||Sungard Availability Services||Data Centers||5/1/2019||$1.0bn+|
|20||Windstream Holdings||Fiber / Copper||2/25/2019||$11.2bn|
|21||Paniolo Cable Company||Subsea Cables||11/13/2018||$209.2m|
1. Cyxtera Technologies
On June 4, 2023, Cyxtera Technologies, Inc., a company providing data center services, including retail colocation and interconnection, filed for Chapter 11 reorganization in the U.S. Bankruptcy Court for the District of New Jersey. The Coral Gables, Florida-headquartered firm, along with its 15 affiliates, listed assets and liabilities in the range of $1 billion to $10 billion. The total outstanding funded debt of Cyxtera, amounting to $1.01 billion, was comprised of $864.4 million in first lien term facilities, $97.1 million in a senior secured asset-based revolving credit facility, and $50 million in an emergency bridge facility.
2. QualTek Services
On May 24, 2023, QualTek Services Inc., a Pennsylvania-based company offering a range of services to the telecom and utilities sectors, filed a voluntary Chapter 11 reorganization petition with the U.S. Bankruptcy Court for the Southern District of Texas. Together with its 17 affiliates, QualTek listed assets and liabilities between $500 million and $1 billion. The company’s diversified services included the installation, project management, and maintenance of fiber optics in the telecom sector and the provision of renewable energy farm installation, testing, and maintenance, along with disaster relief and cell maintenance services in the renewable and recovery logistics segment.
3. Internap Holding
On April 28, 2023, Internap Holding LLC, a Georgia-based provider of data center and network solutions, filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the District of Delaware. Doing business as INAP, along with its three affiliates, the company listed both assets and liabilities ranging from $100 million to $500 million, and proposed a joint reorganization plan. Under this plan, certain claims were to be paid either in full in cash or with shares in the newly restructured company, while general unsecured claims and existing equity interests were left without distribution.
4. Starry Group
On February 20, 2023, Starry Group Holdings, Inc., a licensed fixed wireless technology developer and internet service provider (ISP) headquartered in Boston, Massachusetts, filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the District of Delaware. The company, along with its 11 affiliates, proposed a voluntary sale of its assets for a cash purchase price of $170 million, having listed liabilities in the range of $100 million to $500 million at the time of filing. Under the reorganization plan, most claims were planned to be settled fully in cash or equity, while $43 million in debtor-in-possession (DIP) facility claims were set to be converted into rollover exit facility loans and new warrants.
5. Core Scientific
On December 21, 2022, Core Scientific, Inc., a Texas-based company operating cryptocurrency mining facilities and providing colocation services, filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the Southern District of Texas. The firm and its ten affiliates listed liabilities of $1.19 billion in the bankruptcy proceedings. During the proceedings, the court permitted Core Scientific to obtain multiple debtor-in-possession (DIP) financings, initially amounting to $75 million and later an additional $70 million, as well as to sell Bitmain Coupons.
6. Compute North
On September 22, 2022, Compute North Holdings, Inc., a Minnesota-based developer and operator of blockchain-based data centers, filed for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Southern District of Texas. The company and its 18 affiliates had liabilities totaling $146.7 million at the time of filing. A joint plan of liquidation was approved on February 16, 2023, which included the authorization for the sale of de minimis assets to 7575 Management LLC, which was wholly-owned by Dave Perill, Compute North’s former CEO and a member of its board of directors, for up to $1 million without requiring further court approval.
7. Goodman Networks
On September 6, 2022, Goodman Networks Incorporated, a Texas-based company providing network installation and maintenance services, faced an involuntary petition for Chapter 7 liquidation, filed by Phoenix Investment Adviser’s JLP credit funds and Alimco Re Ltd. At the time, Goodman reported assets of $7.55 million and liabilities of $106.4 million. Despite the company’s attempts to dismiss the case or convert it to Chapter 11 reorganization, the U.S. Bankruptcy Court for the Northern District of Texas approved the liquidation petition on December 12, 2022.
8. Sungard Availability Services
On April 11, 2022, Sungard AS New Holdings, LLC, a Pennsylvania-based provider of hybrid IT solutions, operating 24 data centers and 31 workplace recovery facilities, voluntarily filed for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Southern District of Texas. The company, along with its 11 affiliates, reported assets of $301.1 million and liabilities between $500 million to $1 billion, and during the proceedings, obtained approval to secure up to $285.9 million in debtor-in-possession (DIP) financing. Sungard sold most of its assets to 365 Data Centers for $52.5 million. Despite developing a reorganization plan wherein certain claim classes were fully paid, others compromised, and existing equity interests cancelled, Sungard ultimately ceased operations as its liquidation plan became effective on November 9, 2022.
On March 31, 2022, Sigfox, Inc., the U.S. subsidiary of the French global communications service provider specializing in low-power, wide-area networks (LPWAN) for Internet of Things (IoT) devices, filed for Chapter 7 liquidation in the U.S. Bankruptcy Court for the District of Delaware. The Boston-based company, along with its two affiliates, reported assets of $84.5 million and liabilities of $116.1 million at the time of filing. This filing marked the end of its U.S. operations as per the liquidation procedures under Chapter 7.
10. GTT Communications
On October 31, 2021, GTT Communications, Inc., a Virginia-based provider of global networking services, filed for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Southern District of New York, with both assets and liabilities falling between $1 billion and $10 billion. As part of the bankruptcy process, the company sold its infrastructure division to I Squared Capital for $2.15 billion, which then renamed the division EXA Infrastructure. After the bankruptcy court approved GTT’s reorganization plan in December 2022, which included cash, debt, and equity payments for claims and the cancellation of existing GTT equity interests, the company successfully emerged from Chapter 11 bankruptcy on December 30, 2022.
11. Intelsat (Reorganized ISA)
On May 14, 2020, Intelsat S.A., a Luxembourg-based global satellite communications services provider, filed for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Eastern District of Virginia, with liabilities exceeding $1.0 billion. During the proceedings, the company received approval to obtain a $1 billion multi-draw term loan credit facility from debtor-in-possession (DIP) lenders. Following several legal processes and financial rearrangements, Intelsat’s reorganization plan was approved in December 2021, and the company, then renamed Reorganized ISA S.A., successfully emerged from bankruptcy in February 2022.
12. SpeedCast International
On April 23, 2020, SpeedCast International Limited, a Virginia-based provider of remote communications and satellite connectivity, filed for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Southern District of Texas, with assets of $588.7 million and liabilities of $713.8 million. As part of the process, the company secured debtor-in-possession (DIP) financing and sold nearly all of its assets to Australia’s NBN Co for $12.7 million. The court approved Speedcast’s reorganization plan, which included full or partial payment of various claims, in January 2021, leading the company to successfully emerge from bankruptcy on March 11, 2021.
13. Frontier Communications
On April 14, 2020, Frontier Communications Parent, Inc., a Norwalk, Connecticut-based provider of internet, voice, and video services, voluntarily filed for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Southern District of New York, reporting assets of $14.5 billion and liabilities of $17.1 billion. Throughout the bankruptcy process, the company sold parts of its assets to buyers including Ziply Fiber and Stone Point Properties. Frontier Communications also secured a debtor-in-possession (DIP) financing of $625 million and a term loan facility of $1.65 billion. On April 30, 2021, Frontier Communications and its 103 affiliates successfully emerged from Chapter 11 bankruptcy as their reorganization plan took effect.
14. OneWeb Global Limited
On March 27, 2020, OneWeb Global Limited, a subsidiary of the London-based communications company OneWeb, voluntarily filed for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Southern District of New York. The company, which aimed to deliver global broadband satellite internet services through a constellation of Low Earth Orbit (LEO) satellites, reported assets of $11.6 million and liabilities of $1.75 billion, and subsequently arranged the sale of most of its assets with court approval. OneWeb Global Limited successfully emerged from Chapter 11 bankruptcy after its reorganization plan took effect on November 20, 2020.
15. Internap Technology Solutions
On March 16, 2020, Internap Technology Solutions Inc., a Georgia-based company providing data center and network solutions, filed for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Southern District of New York with six affiliates. The company, listing assets less than $0.05 million and liabilities between $100 million to $500 million, sold certain assets and secured debtor-in-possession (DIP) financing of $70 million during its reorganization process. On May 8, 2020, Internap and its affiliates successfully emerged from bankruptcy after their pre-packaged reorganization plan was approved by the court on May 5, 2020.
16. Seaborn Networks
On December 22, 2019, Seaborn Networks Group, Inc., a Massachusetts-based operator of the Seabras-1 submarine fiber optic cable network that connects Praia Grande, Brazil and Wall Township, New Jersey in the United States, filed for Chapter 11 reorganization alongside an affiliate in the U.S. Bankruptcy Court for the Southern District of New York. At that time, the company’s assets were listed as $51.1 million while liabilities amounted to $150.1 million. The court approved their joint reorganization plan on June 30, 2020, which was funded through cash on hand, restructured debt, and equity investments, resulting in Seabras 1 USA, LLC successfully emerging from bankruptcy on July 7, 2020.
17. Global Cloud Xchange (GCX)
On September 15, 2019, GCX Limited, a Bermuda-based global data communications service provider and subsidiary of Global Cloud Xchange Limited, filed for Chapter 11 reorganization along with its 15 affiliates in the U.S. Bankruptcy Court for the District of Delaware. At the time of filing, the company’s assets and liabilities were estimated to be between $1 billion and $10 billion. The court approved a modified pre-packaged plan of reorganization on December 4, 2019, leading to GCX Limited emerging from bankruptcy on December 31, 2020, under the new ownership of Värde Partners, Bardin Hill, and Portsea Asset Management.
18. Fusion Connect
On June 3, 2019, Fusion Connect, Inc., an Atlanta-based company offering integrated cloud solutions to businesses, filed for Chapter 11 reorganization along with its 18 affiliates in the U.S. Bankruptcy Court for the Southern District of New York. The company, which listed assets of $90.1 million and liabilities of $725.8 million, had its joint plan of reorganization approved by the court on December 17, 2019. The reorganization plan became effective on January 14, 2020, marking the company’s emergence from Chapter 11 bankruptcy. Fusion Connect is owned by funds of Morgan Stanley Private Credit, Ellington Management Group, and Investcorp Credit Management BDC.
19. Sungard Availability Services Capital
On May 1, 2019, Sungard Availability Services Capital, Inc., a Pennsylvania-based company offering data protection and managed IT services, filed for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Southern District of New York, with liabilities exceeding $1 billion. The company proposed a joint pre-packaged plan which was designed to repay various claims in full, in cash, along with some settlement in the form of equity and debt, and this plan was approved by the bankruptcy court just a day after filing. The reorganization plan became effective on May 3, 2019, signaling Sungard’s emergence from Chapter 11 bankruptcy.
20. Windstream Holdings
On February 25, 2019, Windstream Holdings II, LLC, a global communications company providing services including managed communications, high-capacity bandwidth, transport, and broadband, filed for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Southern District of New York, along with its 202 affiliates, listing assets of $13.1 billion and liabilities of $11.2 billion. The company secured a $1 billion debtor-in-possession financing and, following approval of its joint plan of reorganization on June 26, 2020, it progressed towards restructuring. Windstream Holdings II, LLC successfully emerged from Chapter 11 bankruptcy as its reorganization plan took effect on September 21, 2020.
21. Paniolo Cable Company
On November 13, 2018, Paniolo Cable Company, LLC, a non-common carrier fiber-optic submarine cable system operator based in Hawaii, was served an involuntary petition for Chapter 11 reorganization by HSBC, Deutsche Bank, and Sunrise Partners, with the company’s liabilities at filing being $209.2 million. This petition was approved in March 2019 by the U.S. Bankruptcy Court for the District of Hawaii. Subsequently, the court approved the sale of certain assets of Paniolo Cable Company, LLC, to Hawaiian Telcom, and its real property to Blue Ivory Hawaii Corp.