Against deadline on interest due, Frontier borrows time

Weeks after a Bloomberg report that Frontier Communications had discussed with lenders the possibility of a bankruptcy filing, the company disclosed it had invoked what it called a “grace period” from paying interest due on bonds for a period of two months.

Frontier offers broadband, TV and telephone service to 4.3 million people in Connecticut and 28 other states. The Norwalk-based company erased more than 2,000 jobs between January and September last year, giving it a workforce of just over 19,100 people at the time.

After piling up losses of $5.7 billion in the first nine months of 2019, the company replaced former CEO Dan McCarthy in early December with former Dish Network executive Bernie Han. In January, Bloomberg reported Han’s meetings with bondholders that broached the possibility of a bankruptcy.

Frontier has yet to report its annual results — it has done so in February in past years — with a spokesperson not responding to a query last week on its timeline to do so. On Monday, Frontier stated it “continues constructive discussions with its bondholders regarding Frontier’s capital structure” and that it would defer for up to 60 days an interest payment that had been due Monday.

Frontier added that its services continue uninterrupted, as families face extended periods of home-based telecommuting and learning as the outbreak of the novel coronavirus COVID-19 prompts schools to close and employers to ask their people to stay home.

While Comcast, Charter Communications and Altice USA are among the major broadband companies to have announced two months of free broadband for households with students who lack Internet access during the crisis, Frontier had not made any similar announcement as of Monday.

Frontier attributed $378 million of its 2018 revenue to federal and state subsidies it collected to extend broadband to remote areas that lack access and other mechanisms to reduce the cost of offering service.