Sector Spotlight: Debt Comes Knocking at Telecom's Door
Debt comes calling at telecom's door.
Wall Street's rapt attention on the unraveling of Winstar (WCII Quote), PSINet (PSIX Quote), e.spire (ESPI Quote) and NorthPoint, to name a few, isn't out of morbid delight, but rather is a search for clues as to what lies ahead for many more companies crippled by debt payments in the telecom services sector.
Winstar saw its shares plunge below $2 Thursday on concerns that it would be unable to finance its debt. (It closed Friday at $3.03.) PSINet, the 6-year-old granddaddy of Internet service providers, hired bankers Monday to restructure its debt while warning that its shares, now worth 20 cents, may soon be worth nothing. Upstart Baby Bell challenger e.spire sought protection from creditors and filed for Chapter 11 bankruptcy protection Thursday. And NorthPoint, already in bankruptcy, auctioned off most of its equipment to AT&T(T Quote) Thursday. ...
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