Allen Considers Options for Charter

SEC Filing Mentions Recapitalization, Restructuring Transactions to Reduce Leverage

Paul Allen, controlling shareholder of cable operator Charter Communications, is weighing options for the company.

According to a filing with the Securities and Exchange Commission, Allen is considering recapitalization or restructuring transactions that will reduce the company’s leverage. That may include going private or a sale of the company or assets.

Charter has engaged in asset sales in the past for this purpose. In 2006, the company sold cable systems in several transactions that netted $971 million, which the company used to reduce debt.

Charter has a mountain of debt, most of which does not mature until after 2010. Of the more than $19 billion in outstanding debt at the company, $65 million is due to mature by the end of 2008. In 2009, $666 million will mature.

The credit crunch has shut off access to the markets for companies at the lower rungs of the credit ladder, making it difficult to refinance debt. But in its quarterly report, Charter stated that it currently has the ability to draw up to $1.4 billion under an existing credit facility.