Court OKs Digital Teleport Bankruptcy Sale

Communications Today, Jan 16, 2003

The U. S. Bankruptcy Court for the Eastern District of Missouri in St. Louis gave Digital Teleport Inc. the nod to move forward with an auction of its regional fiber business, ensuring approved creditors will receive as much as 90 percent of their claims against the carrier. CenturyTel already has forwarded an opening bid of $38 million. The settlement agreement was approved previously by Digital Teleport, its parent company KLT Telecom Inc. and its affiliates, and the official committee of unsecured creditors. The wholesale fiber carrier filed voluntary Chapter 11 petitions Dec. 31, 2001, indicating plans to quit the national long-haul business and to focus on operating its core fiber-optic network in the Midwest.

"In most bankruptcy settlements, unsecured creditors are generally left holding pennies on a dollar or nothing at all," says Paul Pierron, Digital Teleport's president and CEO. "The value we propose to provide unsecured creditors speaks to the strength of our management team and its ability to focus on growing this business in spite of the economic downturn and the stigma of operating under bankruptcy over the past year." For more on this and other hot topics within the fiber-optics sector, be sure to read the latest edition of Fiber Optics News. For subscription information, visit the "newsstand" at http://www.TelecomWeb.com.

[Copyright 2003 PBI Media, LLC. All rights reserved.]