Conexant Systems, a supplier of innovative semiconductor solutions for imaging, audio, embedded modem and video applications, today announced that it has obtained bankruptcy court approval of its chapter 11 plan of reorganization.
Conexant Systems, a supplier of innovative semiconductor solutions for imaging, audio, embedded modem and video applications, today announced that it has obtained bankruptcy court approval of its chapter 11 plan of reorganization.
“We are extremely pleased to have received court approval of our plan of reorganization, which will pave the way for Conexant to emerge as a stronger, more focused company that will be better able to serve our customers,” said Sailesh Chittipeddi, President and CEO of Conexant.
Conexant entered chapter 11 on February 28, 2013 with approximately $195 million of secured debt held by QP SFM Capital Holdings, an entity managed by Soros Fund Management. As part of its pre-arranged restructuring, the Secured Lender agreed to receive 100 percent of the equity in the reorganized Company as well as $76 million in new unsecured notes in exchange for its claims. The unsecured notes will be issued by a holding company, which can elect to either pay interest in cash or accrue interest in kind, and will be non-recourse to the reorganized Conexant operating company.
As a result of the restructuring, the Company has significantly streamlined its capital structure and operations by eliminating all prepetition debt and cash interest obligations at the reorganized operating company and substantially reducing operating expenses through a comprehensive operational restructuring. In addition, the Secured Lender is providing the reorganized Company with a $15 million facility to provide liquidity for working capital and other corporate purposes.
“Through the persistence and efforts of all of our employees, Conexant will emerge from its restructuring poised to invest in meeting our customer needs,” said Chittipeddi.