My finance view

After announcing last month that it had enough cash to operate only through the middle of next year, Charter Communications Inc. now plans to raise $775 million in new debt by issuing notes and taking out loans.

Town and Country-based Charter, the area’s dominant cable provider, is facing serious financial problems. It’s strapped with long-term debt of $19.9 billion, as of Dec. 31, and last month reported a fourth-quarter interest expense of $466 million.

In the next two weeks, Charter will sell $500 million in bonds due to mature in 2014 and borrow $275 million,, according to a regulatory filing.

The funds, which will be used to pay off other debt and for "general corporate purposes," allow the company to remain solvent through 2009.
What will happen in 2010 remains unknown. Unless Charter comes up with more cash, it could be forced into bankruptcy that year, the company said.

Still, the new debt — and the higher interest expenses — didn’t concern Jason Bazinet, an analyst with Citi Investment Research.

"Given Charter’s robust operating results, the company needs time — more than anything else — to grow into its capital structure," Bazinet, who gave Charter a "buy/speculative" rating, wrote Tuesday in a research note payday loan cash advance loan. "Thus, a successful placement of (more debt) — at almost any interest rate — is viewed as a positive for equity holders."

Meanwhile, in the same regulatory filing, Charter said that shareholder Paul Allen, the Seattle billionaire who has a 51 percent stake in the company and controls 91 percent of the voting power, has been contacted by potential investors.

The company said there is no assurance that any investment or deal would be made.

The nature of any deal was unclear, and Charter spokeswoman Anita Lamont could not elaborate.

In another regulatory filing Tuesday, Charter said that Jeffrey T. Fisher, chief financial officer and executive vice president, will resign in April. Fisher, 45, joined Charter in 2006. Eloise Schmitz will take over the position temporarily, while continuing as senior vice president of strategic planning.

Lamont said Fisher’s decision to resign was for personal reasons and unrelated to the refinancing.

atablac@post-dispatch.com | 314-340-8140

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