CORINTH, Texas, Dec. 16, 2002 — CoServ Electric and CoServ Telecom Friday announced that their two Chapter 11 plans previously confirmed by the U.S. Bankruptcy Court have become effective, completing the Chapter 11 reorganization process for all CoServ entities that was first initiated voluntarily by certain CoServ entities November 30, 2001.
CoServ Electric and related entities include CoServ Electric, CoServ Investments, L.P. and CoServ Utility Holdings, L.P. The approved plan for CoServ Electric and its related entities reflects an agreement reached in May and confirmed in September, and includes total refinancing of CoServ’s debt, payment in full of all of CoServ’s unsecured creditors, and a 10-year $200 million capital expenditure credit facility.
Additionally, CoServ Electric has diversified its lenders to include CoBank, an institution that provides lending to electric cooperatives, as well as its previous lender, the National Rural Utilities Cooperative Finance Corporation (CFC).
“This is a great outcome for our members and our family of electric companies,” said Bill McGinnis, chief executive officer. “And the $200 million credit facility puts us in a good position to continue to grow. In fact, throughout the reorganization process, we’ve remained strong and have continued to grow. Over the last 12 months, we’ve grown at a rate of more than 12% to 84,985 meters in 2002 from 75,517 in 2001, and we remain committed to delivering the high quality of electric service that we believe will help us continue to increase our customer base in the future.”
The six CoServ Telecom entities whose plans also become effective include CoServ, L.L.C. d/b/a CoServ Communications, CoServ Telecom GP, L.L.C., CoServ Telecom Holdings, L.P., DWB GP, Inc, MultiTechnology Services, L.P. d/b/a CoServ Broadband Services and Dallas Wireless Broadband, L.P. d/b/a CoServ Broadband. The assets of these entities, which include telephone and cable, have been transferred to Denton Telecom Partners I, L.P. and will conduct business under the name AdvanTex Communications, operating as an affiliate of CFC.
“While CoServ will no longer be involved with the communications services, we expect these customers to continue to receive high levels of service,” said McGinnis.
CoServ Realty Holdings, L.P. announced October 11, 2002, that its Chapter 11 plan previously confirmed by the U.S. Bankruptcy Court became effective, making it the first of three CoServ Chapter 11 plans to emerge from bankruptcy protection.
On November 30, 2001, CoServ sought Chapter 11 protection for its telephone and cable companies. On February 1, 2002, CoServ sought Chapter 11 protection for its electric and related companies.
For nearly 65 years, CoServ Electric has provided dependable, affordable, electric power to thousands of homes. Further information on CoServ Electric is accessible at www.coserv.com.