November 16, 2009 at 1:08 PM HST - Updated June 17 at 4:37 AM
HONOLULU (HAWAIINEWSNOW) - Bankruptcy judge Lloyd King on Friday approved a reorganization plan for Hawaiian Telcom. The actual reorganization will happen early next year assuming approved by state regulators. Who wins and who loses in this decision?
Bondholders who invested hundreds of millions at the formation of the company in2005 lose. They get something like two or three cents on the dollar. They had argued their investment was even now worth more than ten times what they're getting, but they couldn't find anyone to agree with them.
Sandwich Isles Communications, which bid to take over the company, couldn't get traction for that idea, either. So that leaves the existing work force with the same union contracts as before, and the existing management, with about a quarter of the company's former debt.