SmarTalk and 19 units file chapter 11 bankruptcy
WILMINGTON, Del, Jan 19 (Reuters) - SmarTalk TeleServices Inc (Nasdaq:SMTK - news) and 19 affiliates filed for chapter 11 protection late Tuesday in the U.S. Bankruptcy Court in Delaware.
In court papers, the company listed assets of $406.3 million and debts of $226.9 million, including $150 million in subordinated debt.
Among the 20 largest unsecured creditors are 1,000 holders of $150 million in notes with Wilmington Trust Co of Delaware the agent.
The remaining unsecured debt is in trade claims including a disputed one for $11.5 million held by Philips Consumer Communications LLP of St.
Louis, Missouri, and an $11.0 million claim by Frontier Corp of Rochester, New York.
AT&T (NYSE:T - news) said Tuesday it had agreed to buy SmarTalk for up to $192.5 million, which is subject to being adjusted down at closing,
and has provided debtor-in-possession financing.
The deal, expected to close in the first quarter of 1999 while the bankruptcy case is pending, will require approval by the bankruptcy court and regulatory agencies.
SmarTalk, of Dublin, Ohio, provides prepaid telecommunications products and services, primarily through its SmarTalk prepaid phone card.
Owners of five percent or more of SmarTalk stock are Fletcher International Ltd, Robert Lorsch, and Victor Grillo Jr.
SmarTalk owns all the stock of the 19 affiliates which are also in chapter 11 protection. They include: Worldwide Direct Inc, ConQuest
Telecommunication Services Corp, SmarTalk USPS Sales Co, GTI Telecom Inc, USA Telecommunications Services Inc, SmarTel Communications
Inc, SMTK NY-1 Corp, Creative Network Marketing Inc, and several similarly named entities.
I no longer hold any shares......but did pretty good day trading SMTK last week.....anyway, I guess this news isn't that surprising.eom |
