Adelphia Communications Corp.

2006 to Present

Quest Turnaround Advisors Case Study for Adelphia Communications Corp.

Quest Turnaround Advisors, LLC ("Quest") was retained by the Unsecured Creditors Committee of Adelphia Communications Corporation ("Adelphia") in August 2006 as a special advisor. In February 2007, Quest was retained by Adelphia as the Plan Administrator upon consummation of Adelphia's Plan of Reorganization ("the Plan"). In its role as Plan Administrator, Quest replaced Adelphia's board of directors, as well as its senior management and assumed total responsibility for establishing and maintaining Adelphia's assets, accounts, reserves and escrows, determining the amount and timing of Plan Distributions and otherwise implementing the Plan.


In so doing Quest was required to:


• Evaluate and reorganize financial reporting, accounting, cash and treasury management

  systems to manage in excess of $14 billion of assets entrusted to Quest on the Effective Date

• Prepare Adelphia's business plan and reserved cash sufficient to enable Adelphia to fulfill its
  responsibilities to complete its liquidation

• Establish retention plan for employees that were required to assist Quest implement the Plan

• Coordinate and manage over 50 outside professionals providing legal and support services

• Research and resolve more than 23,000 claims filed totaling $3.2 trillion

• Evaluate and negotiate claims made against $750 million sale escrow in connection with $18

  billion sale of assets to Time Warner and Comcast

• Calculate and implement complex stock true-up based on TWC stock price performance for

  the test period following the Effective Date

• Coordinate and complete $715 million settlement with the Department of Justice

• Oversee resolution of all tax matters including filing required federal and state returns,

  ongoing income, franchise, royalty, property, and sales/use tax audits, and assessing effect of

  consolidated restatement adjustments on state returns (approximately 4,000 returns) filed for

  260 entities during the 2002 to 2006 period

• Recover amounts remaining in other asset sale escrows, deferred purchase price agreements

  and security for surety bonds and letters of credit

• Sell 92 real estate assets not sold to Time Warner and Comcast

• Sell Brazilian cable operations

• Oversee the termination of employee benefit plans

• Maintain legacy computer systems and data for litigation purposes; and

• File quarterly post confirmation status reports to provide update on progress of the case


Under Quest’s management, Adelphia distributed a total of $14.9 billion, $13.9 billion to banks and holders of allowed claims ($13.2 billion within one year) and approximately $1 billion for other payments required under the plan. Approximately $1.9 billion more than was projected in the Disclosure Statement was distributed to holders of allowed claims. Subsidiary creditors received 100% of the face amount of their claims plus post petition interest. Creditors of the parent have received more than 70% face amount of their claims. Adelphia creditors may receive further distributions after resolution of remaining assets.



© Copyright 2023  •  Quest Turnaround Advisors  •  All Rights Reserved.