Digital Infrastructure

Cell tower company QualTek files for bankruptcy

BLUE BELL, Pa. – QualTek Services Inc. (NASDAQ: QTEK) (the "Company" or "QualTek"), a leading infrastructure services provider, today announced a restructuring transaction that will position it to achieve long-term success in the telecom, renewables, and recovery logistics sectors. The restructuring transaction reduces the Company's debt by approximately $307 million and provides $40 million of additional liquidity, substantially improving the Company's balance sheet and financial position.

To facilitate the financial restructuring, the Company and certain of its subsidiaries have filed voluntarily petitions for Chapter 11 cases in the United States Bankruptcy Court for the Southern District of Texas. QualTek expects significant support of its lenders through this process, including at least 85% of the Company's secured debt holders and approximately 80% of its convertible noteholders. The Company will be filing a Restructuring Support Agreement ("RSA") and Plan of Reorganization ("Plan"), which contemplates that, upon emergence from Chapter 11, there will be new ownership comprised of the Company's existing lenders and management team.

The RSA provides a better roadmap for QualTek to emerge swiftly from Chapter 11 with a strong balance sheet and positioned to invest in growth. Under the terms of the RSA, the Company contemplates a $65 million debtor-in-possession term loan financing facility ("DIP Facility"), which will include a new money funding of $40 million. Upon approval by the Court, the DIP Facility will provide the Company with the stability and liquidity needed to continue operations in the ordinary course of business and pay vendors during the reorganization. Management continues to lead the business, roles and responsibilities across the team remain the same, and operations across the Company are expected to continue as usual.

Read the full press release here.


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