Seaborn Networks, which operates sub-ocean internet cables, has put the owner of a fiber-optic cable system running from New York and New Jersey to São Paulo, Brazil, into chapter 11 to restructure its balance sheet, WSJ Pro Bankruptcy reported. Seaborn Networks blamed the bankruptcy filing on unexpected competition from a newer cable operator and economic turmoil arising from the so-called Car Wash corruption scandal that has engulfed Brazilian business and political leaders. The negative events resulted in “severe price drops” for the U.S.-Brazil cable route that were far lower than Seaborn Networks’ management, market consultants, shareholders or its lenders previously anticipated, Seaborn Networks Chief Financial Officer Roger Kuebel said in a declaration filed Sunday in the U.S. Bankruptcy Court in Manhattan. The bankruptcy filing is not anticipated to interrupt the company’s business operations, Seaborn Networks Chief Executive Officer Larry Schwartz said in a letter to its customers and vendors. The company said that it expects to complete a process for restructuring its subsidiaries’ balance sheets over the next few months, intending to emerge from chapter 11 protection in the second quarter of 2020.
