Windstream Holdings, parent company of the Hiawatha communications business, filed for Chapter 11 bankruptcy on Monday.
Windstream said it has no plans to restructure its operations at this time, according to Bloomberg News.
Windstream has received an agreement from Citigroup for $1 billion in debtor-in-possession financing, the Little Rock, Ark., business said in a news release.
The Hiawatha facility employs about 340.
“Taking this proactive step will ensure that Windstream has access to the capital and resources we need to continue building on Windstream’s strong operational momentum while we engage in constructive discussions with our creditors regarding the terms of a consensual plan of reorganization,” Tony Thomas, Windstream president and CEO, said in the release.
“We acted decisively to secure the long-term financial stability of Windstream, and we are confident that, upon completion of the reorganization process, we will be even better positioned to invest in our business, expand our speed and capabilities for our customers and compete for the long term.”
The bankruptcy action came after a court ruled in favor of a New York hedge fund, Aurelius. The hedge fund said Windstream defaulted on its bonds when it spun off Uniti Group four years ago, thereby reducing assets that support bond holders’ investments.
Windstream reported more than $10 billion in assets and liabilities in the bankruptcy filing, Bloomberg News reported.