Mexico's Maxcom Telecomunicaciones said Tuesday it was looking to raise new capital and restructure debt after failing to make an interest payment.
In a filing with the Mexican Stock Exchange, Maxcom said it would use a 30-day grace period with respect to Tuesday's scheduled interest payment of roughly $11 million to continue talks with a new investor and certain of its bondholders with a view to recapitalizing and reorganizing the company's debt.
The telecommunications company said it was prudent to use the grace period to implement a "comprehensive recapitalization" that would significantly reduce its debt-servicing costs and position Maxcom for growth with a $45 million capital infusion.
Maxcom said it already was negotiating the "terms of restructuring and recapitalization agreements, which would be implemented through a voluntary, pre-packaged Chapter 11 filing under the U.S. Bankruptcy Code and an equity tender offer in accordance with U.S. and Mexican securities laws."
"No assurances can be given that a proposed recapitalization and restructuring will be successful or that holders of Maxcom's debt obligations and/or relevant stakeholders will reach an agreement," the company added.
If no consensus is reached among a significant portion of the company's creditors, the company "may be forced to file for bankruptcy or consurso mercantil (insolvency)," Maxcom said.
A failure to restructure the company's debt "could have a material adverse effect on the business or the interests of holders of Maxcom's debt and equity securities," the company said.
Since 1999, Maxcom has offered local and long-distance telephony, data, paid TV and IP-based services to micro, small and medium-sized businesses, as well as residential customers, in the Mexican market.
The company operates a 6,421-kilometer (3,880-mile) fiber-optic network and has a presence in 62 Mexican cities. EFE