NEW YORK (AP)
-- Ambulance and fire protection services provider Rural/Metro Corp.
says that it filed for Chapter 11 bankruptcy reorganization, after
reaching a deal with its lenders to cut its debt by about half.
company, which provides services in 21 states, said Sunday that it
expects to continue its operations throughout the reorganization
process. Lenders have agreed to provide the company $75 million in
debtor-in-possession financing to meet its operational needs.
said it will also receive a cash infusion of $135 million as part of
its agreement with lenders and bondholders, which will be filed in U.S.
Bankruptcy Court for the District of Delaware.
company noted that its capital structure was created "under different
economic circumstances, and making interest payments on the debt while
at the same time investing in operations was more than the company's
earnings could support."
Rural/Metro, which is
based in Scottsdale, Ariz., expects to complete its restructuring by
the fourth quarter. It plans to renegotiate unprofitable contracts and
free up capital to invest in its business.
Private equity firm Warburg Pincus bought Rural/Metro in 2011 for about $438 million.
Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.