It is now official. The most interesting thing of all -- look at the symbol it will trade under after consolidation. Prelude to a buyout after the foreign ownership regulations are loosened??
Attention Business Editors:
Call-Net receives court approval for recapitalization proposal
TORONTO, April 5 /CNW/ - Call-Net Enterprises Inc. (TSE: CN, CN.B)
announced today that it has received a final order from the Ontario Superior
Court of Justice approving the plan of arrangement for the Company's
comprehensive recapitalization proposal.
The order follows the overwhelming approval by Call-Net noteholders and
shareholders on April 3 for the plan, which will reduce the Company's debt by
more than $2 billion. More than 97% of the votes cast by noteholders, and 96%
of votes cast by shareholders supported the proposal at separate meetings.
"We are gratified by the Court's decision today. The earlier support from
securityholders is a significant endorsement of the company and our business
plan," said Bill Linton, President and Chief Executive Officer of Call-Net
Enterprises. "We set out to create a comprehensive and fair solution that
would give Call-Net a stronger capital structure - a financial foundation to
support a competitive and successful company. By delivering on that
commitment, we have completed a vital step to Call-Net's achieving its full,
long-term potential."
Randy Benson, Call-Net's Chief Financial Officer said: "Completing the
recapitalization required the combined effort, support and good will of our
Board of Directors, management, shareholders and noteholders. Working together
we achieved a solution that was best for Call-Net, both in the short and long
term. The elimination of more than $2 billion in debt greatly increases our
financial flexibility to the benefit of all our stakeholders."
"An improved capital structure was one of Call-Net's strategic
initiatives to become a viable and valuable company," Mr. Linton said. "In the
past year, we have successfully implemented an appropriate operating strategy
and the financial disciplines to support it. We have also made a strong case
for progressive changes to the regulatory environment. While a decision has
not yet been received on the price cap review, we believe the regulator will
move to encourage the sustainable competition and access to technology that
Canadians want in our industry."
In addition, Call-Net secured a new, 10-year branding and technology
services agreement with Sprint Communications Company LP. This agreement gives
Call-Net access to branding, technology and know-how to offer the full suite
of Sprint wireline services in Canada. It also facilitates seamlessness and
consistency in the two companies' networks and services provided to North
American customers.
"We believe the Sprint agreement, combined with our recent, operating,
financial and regulatory initiatives, creates a solid base for future growth
and profitability at Call-Net," Mr. Linton said.
With the Court's approval, the recapitalization transaction is scheduled
to close on April 10, 2002 subject to receipt of all necessary regulatory and
stock exchange approvals. The final order on the plan of arrangement was
issued under the Canada Business Corporations Act.
After closing on April 10, Call-Net's equity will be consolidated on a
one for twenty basis, and begin trading on the TSE under the new symbols FON
and FON.B. |
