BearingPoint files bankruptcy
BearingPoint, the consulting company that is leading the Transition Administrator’s (TA) project management of the 800 MHz rebanding efforts, yesterday announced its U.S. operation has filed for Chapter 11 bankruptcy as part of a financial restructuring deal with its senior secured lenders.
News of the bankruptcy reorganization was not surprising, as BearingPoint has struggled financially for some time, and its stock has been trading for less than $1 per share during the past two weeks, including 38 cents per share as of close of business Tuesday. After announcing its bankruptcy plans, BearingPoint’s stock has been traded for less than 10 cents per share on over-the-counter exchanges during the past two days.
In a statement released with the bankruptcy announcement, BearingPoint CEO Ed Harbach said “our day-to-day operations will continue uninterrupted and we want to assure our employees and customers that we remain committed to serving our clients and to providing world-class consulting solutions.”
FCC spokesman Rob Kenny said the agency has spoken with BearingPoint representatives about the matter to determine any potential impact on 800 MHz rebanding.
“In those discussions, BearingPoint has indicated that they don’t expect any disruptions to the process, but we’re going to closely monitor the situation to ensure that things are going smoothly,” Kenny said today during an interview with Urgent Communications.
The subject of BearingPoint’s financial status and its relationship to rebanding was addressed during a panel on Monday at the Association of Public-Safety Communications Officials (APCO) Winter Summit in Orlando. During the session, moderator Alan Tilles—a partner in the law firm of Shulman Rogers Gandal Pordy & Ecker—asked whether the TA could continue to operate if BearingPoint has problems. TA attorney Robert Kelly replied that he does not believe it is something public-safety licensees need to worry about.
“I think it is probably inappropriate to speculate about BearingPoint, but we’re confident that the TA can perform its obligations under any circumstances that may reasonably arise,” Kelly said. “Really, there should be no basis for any anxiety about that.”
BearingPoint spokesman Steve Lunceford echoed this sentiment during an interview today with Urgent Communications.
“The restructuring doesn’t affect our ability to serve our clients on a day-to-day basis,” Lunceford said. “There shouldn’t be anything that affects [rebanding]—it should be very transparent from the commission’s standpoint, in terms of our ability to serve as part of the TA.”
In addition, Lunceford said BearingPoint does not expect to be in bankruptcy long.
“Because it’s a voluntary or prearranged, we expect to emerge relatively quickly—we anticipate roughly four months,” he said.