Windstream Holdings Inc. on Sept. 22 completed its financial restructuring process and emerged from Chapter 11, the company announced.

The company said it had reduced its debt by more than $4 billion, or about two-thirds, and that it now has access to approximately $2 billion in new capital.

The White Plains, N.Y., bankruptcy court confirmed the company's reorganization plan June 25. The plan was premised on a global settlement reached between Windstream and Uniti Group in early March, on whether the prepetition sale-leaseback transaction between the two companies should be characterized as a lease or a financing transaction subject to avoidance as a potential fraudulent conveyance.

Junior creditors had hoped that proceeds of the avoidance claims against Uniti would fund a recovery for them, but it was not to be the case.

The company's first-lien lenders are slated to receive virtually all the value under the proposed plan, including 100% of the reorganized company’s equity, participation rights in a rights offering and a new senior secured exit credit facility. Even taking the settlement of the Uniti dispute into account, according to the disclosure statement, the recovery rate for first-lien lenders was estimated at 62.8%-71.3%.

Second-lien and unsecured claim holders are slated to receive a small cash recovery of $0.00125 for each $1 of allowed claims.

According to court filings, the plan was accepted by holders of about 99% of the company's first-lien debt by amount and 90% by number, and holders of about 74% of the company's second-lien note claims by both amount and number. Holders of unsecured note claims and holders of general unsecured claims rejected the plan, however, with holders of only 56.2% and 42.55%, respectively, by amount voting to accept, below the two-thirds threshold, necessitating a cram-down (in both classes, however, more than 50% of the holders of claims by number voted to accept).

Kirkland & Ellis served as the company's legal counsel, PJT Partners as its financial adviser and Alvarez & Marsal served as its restructuring adviser.