Telecommunication firm GTT Communications Inc (OTCMKTS:GTTN) came into considerable focus among investors yesterday after it announced that it would be filing for pre-packaged chapter 11 bankruptcy. The company announced that it was going to file it after the sale of its infrastructure unit to Squared Capital is completed. It should be noted that the sale of the infrastructure unit had been announced by the company previously.
However, investors seemed to be quite bullish about the possibilities of a Chapter 11 filing and flocked to the stock in droves yesterday. The GTT stock ended the day with gains of 16% and it is going to be interesting to see if the stock can add to its gains today.
The sale is going to be completed for a sum of as much as $2.15 billion and once it is completed, the company along with its subsidiaries are going to file bankruptcy with the United States Bankruptcy Court for the Southern District of New York. In this context, it is also necessary to note that a chapter 11 filing implies a reorganisation bankruptcy and the company is going to be able to operate its business while it gets its house in order.