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COLT Accused of Insolvency
Hedge fund Highberry Limited will petition for the appointment of an administrator for COLT Telecom; COLT says that's just rubbish
October 10, 2002
1 Min Read
LONDON -- The Board of COLT Telecom Group plc announces that Highberry Limited (a Hedge Fund) has notified COLT that it intends to present a petition for the appointment of an administrator to COLT. There is no basis whatever for Highberry taking this action. Highberry alleges that COLT will not be able to repay or refinance its bonds when they become due between 2005 and 2009. Highberry claims that its allegation justifies the appointment of an administrator. The Board believes that the allegations made by Highberry are entirely without foundation:
COLT has approximately £1 billion of cash, with no bank debt
COLT's EBITDA is growing and its capital expenditure requirement is reducing, as the core network construction is now complete
COLT expects to be free cashflow positive during 2005
The Board is confident that COLT will be able to repay or refinance its bonds when they fall due
The Board will take whatever steps are required to protect the interests of its stakeholders against this self-serving attempt to force an unjustified transfer of value from shareholders to bondholders.COLT Telecom Group plc
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