Adelphia Communications (ADLAE) still faces titanic problems, but at least it has filled some empty deck chairs.
On Tuesday evening, the troubled cable operator announced that it had seated two new members on its board of directors, which up until last week had been controlled by the Rigas family of Coudersport, Pa.
Leonard Tow, a major shareholder who two weeks ago claimed the right to name himself and two others to the board of the troubled cable television operator, took a seat along with one of his business associates, Scott Schneider.
Following last week's resignation of four members of the Rigas family, the company's fate is now in the hands of six independent directors -- Tow, Schneider and four directors who had served alongside the Rigas family. A company spokeswoman said Tuesday that she didn't know whether a fifth member of the Rigas family -- Peter Venetis, son-in-law of founder John J. Rigas -- was still on the company's board.
The remaining board members face the overwhelming task of untangling the company's complex financial relationships with the Rigases, and finding the cash necessary for Adelphia to make its debt payments and fund operations.
"Scott Schneider and I are prepared to deal with the seriouschallenges facing Adelphia," said Tow in a statement Tuesday. "As the largest unaffiliated investor in Adelphia, my interests are clearly aligned with those of all Adelphia banks, bondholders and shareholders. Additionally, Scott and I have extensive experience in the cable industry and an in-depth knowledge of many of Adelphia's assets. We are committed to restoring Adelphia's credibility and stabilizing the company financially in order to protect the interests of all Adelphia's public and private lenders and shareholders."
Shares in Adelphia fell 28% to close at $2 Tuesday, the first day of trading following the Friday night release of a preliminary report detailing
an eye-popping number of related-party dealings between Adelphia and the Rigases.