Windstream Holdings Inc., the rural broadband provider that recently lost a legal battle with hedge fund Aurelius Capital Management, is likely to file for bankruptcy by mid-March, a Citibank NA report said on Wednesday, WSJ Pro Bankruptcy reported. In a research note, Citibank analysts David Phipps and Tony Deng said last week’s judgment in favor of Aurelius will likely trigger defaults on the company’s debt next month. They said a Windstream bankruptcy could last more than one year. A Windstream spokesman said Thursday the company is considering “all potential alternatives to maximize value for its stakeholders, maintain sufficient liquidity, and preserve the company’s long-term potential.” U.S. District Judge Jesse Furman ruled Feb. 15 that Windstream defaulted on its debt when it spun off its fiber-optic business, and the judge also awarded bondholder Aurelius more than $310 million in principal plus interest. Aurelius, the hedge fund run by ex-bankruptcy lawyer Mark Brodsky, had claimed Windstream Services, a subsidiary of publicly traded Windstream Holdings, defaulted on its bonds when it spun off its fiber-optic cable network into a new company called Uniti Group Inc. in 2015.
