BY Fraser Tennant
In a bid to trim a debt of more than $500m, telecommunications services provider Mobileum and certain of its US-based affiliates has filed for Chapter 11 bankruptcy in order to complete a restructuring support agreement (RSA).
The RSA, which has the full support of its key financial partners, will strengthen Mobileum’s financial foundation, significantly deleverage its capital structure and provide the company with $60m of new money through a debtor-in-possession (DIP)-to-exit facility.
The Chapter 11 filing does not include any of Mobileum’s non-US subsidiaries, and the company’s international operations are not part of the court-supervised restructuring process. Additionally, the RSA contemplates that trade vendors and suppliers will be paid in full under normal terms for goods and services provided on or after the filing date.
Through the RSA and related restructuring transactions, Mobileum is expected to eliminate $529m of prepetition debt and substantially reduce its interest expense burden, positioning the company for sustainable, long-term growth and allowing Mobileum to continue to capitalise on long-term 5G and internet of things tailwinds.
Global operations are expected to continue without interruption during the Chapter 11 cases, including complete continuity of all telecommunications products and services. Mobileum expects to swiftly complete its financial restructuring and emerge from Chapter 11 within 60 days.
“The RSA and filing are important steps forward that will position Mobileum to continue as a leading provider for the telecommunications industry for the long-term,” said Mike Salfity, chief executive of Mobileum. “With a strengthened balance sheet and the committed support of our financial partners, Mobileum will be equipped with the financial flexibility to build for the future and continue driving value for our customers through our suite of category-defining analytics solutions.”
Headquartered in Silicon Valley, Mobileum is a leading provider of telecommunications analytics solutions for roaming, core network, security, risk management, domestic and international connectivity testing and customer intelligence. It has global offices in countries including Germany, Greece, India, Japan, Portugal, Singapore and the United Arab Emirates.
Mr Salfity concluded: “We expect complete continuity during the Chapter 11 and RSA processes, and for our customers to maintain uninterrupted access to Mobileum’s mission critical products and services.”