Icahn expects 95% of XO debt

Copyright 2002 The Deal L.L.C.
The Daily Deal...08/29/2002
From LexisNexis

Jonathan Berke
From The August 29, 2002 Edition Of CED Broadband Direct

Carl Icahn said Wednesday he expects to have 95 percent of XO Communications Inc.'s $1 billion in bank debt after he closes on his tender offer Thursday, Aug. 29.

This would give Icahn control of the Reston, Va.

-based broadband provider if it fails to close on a proposed Forstmann Little & Co.-led buyout offer and opts to pursue a stand-alone proposal.

Icahn, who has an interest in $171 million of XO's bank debt, will acquire another $776 million worth via an offer of 50 cents on the dollar.

Though the Forstmann-backed offer - an $800 capital infusion by Forstmann Little and Telefonos de Mexico SA de CV - has been confirmed by the bankruptcy court, XO still needs to satisfy all the conditions of the offer by Sept. 15.

If it can do so, the $1 billion in bank debt would simply roll over to the reorganized company. If not, then the stand-alone plan would give Icahn a majority stake in the company.