Another ownership group is buying into Windstream Holdings Inc., which was acquired by a New York hedge fund three years ago and now is taking on foreign investors to complete ownership reorganization of the Little Rock-based communications provider.
The Federal Communications Commission on Friday approved Windstream's proposal to sell a large stake in the company to Nexus Aggregator, which will own 49.27% of Windstream. FCC approval was required to exceed a 25% ownership benchmark set by federal regulators.
The FCC's approval noted that a total of 66.29% of Windstream will be foreign-owned, including entities tied to Elliott Management Corp., the hedge fund that purchased Windstream's distressed assets in bankruptcy in 2020. That was step one in the reorganization, which allowed Windstream to emerge from bankruptcy as a privately held company with reduced debt and a commitment from the new owners to invest $750 million to expand operations.
"We find that public interest would not be served by prohibiting foreign ownership of Windstream," the FCC said in Friday's order. That approval completed step two of the reorganization, which relied on the foreign investment.
"This order is the last step necessary to approve Windstream's ownership structure in relation to its emergence" from bankruptcy, Kristi Moody, the company's general counsel, said in a statement Monday.
The FCC requires that telecommunications carriers in the U.S. have less than 25% ownership by foreign investors. Windstream's investors have corporations in Canada, Australia, Germany and the Cayman Islands, according to Moody.
Windstream provides voice, data and transport services over a fiber network.