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News > Technology
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Adelphia misses interest payments
Cable company can't pay $55M on outstanding notes; auditor retracts certifications.
June 17, 2002: 7:13 PM EDT

NEW YORK (CNN/Money) - Embattled cable company Adelphia Communications Corp. late Monday said it and one of its subsidiaries had failed to make interest payments on some of their debt securities and that its former auditor is withdrawing certifications of some of its past financial statements.

The double-barreled blast of bad news was the latest in a string of troubling developments for the Coudersport, Pa.-based company, which is the target of a Securities and Exchange Commission accounting probe and two federal grand jury investigations into multibillion-dollar off-balance-sheet loans to its founders.

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In a brief statement issued late Monday, Adelphia said it had missed a payment of $51.25 million on senior notes due in November 2009. The company also said its subsidiary, Arahova Communications Inc., had missed a payment of $4.19 million on 8.375 percent senior notes due December 2007.

Executives of Adelphia could not be reached for further comment.

The company also said its former independent auditor, Deloitte & Touche , will withdraw certifications it issued of financial results for Adelphia and its subsidiaries since March 2001.

Adelphia fired Deloitte on June 9 and replaced it with PricewaterhouseCoopers last week.

PriceWaterhouseCoopers has been working with the company's internal audit committee to investigate the dealings between Adelphia and its founders, the Rigas family.

Adelphia CEO John Rigas and his son Timothy, who was chief financial officer, left the company last month amid investigations into $3.1 billion in questionable loans that were co-borrowed by the company.

The company's board of directors reportedly had been mulling several options to avoid missing the interest payments on its outstanding debt, and many company watchers believe it will be forced to file for Chapter 11 bankruptcy protection.

An Adelphia unit, Century Communications Corp., last week filed for bankruptcy protection. On the same day, Adelphia announced that it had revised its 2000 and 2001 sales and subscriber numbers downward, citing errors in previous reports, and fired Deloitte & Touche.  Top of page






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