Telex to Wall Street:
“Give Me Just a Little MORE More Time…”
By Chris Doering, Marketing Partner
Dynamic Market Systems

“Give me just a little more time, and our love will surely grow,” the Chairmen of the Board pleaded over and over again in their one hit (#1 for a week in 1970). Top management may not be quite so confident at Telex HQ in Burnsville, MN or in Cherry Hill, NJ, where Greenwich Capital Partners is based. But on the premise that the fat lady is still in the dressing room squeezing into her corset, Telex has again extended the deadline on its Exchange Offer and Consent Solicitation. This time it is set to expire on Friday October 26th, two weeks after the original expiration date for the conversion of most of Telex’ $350 million plus debt into equity.

In the first week of overtime, the numbers have not changed: Telex revealed that it has received tenders for about $27.5 million of it 10.5% Senior Subordinated Notes along with $18.5 million of the 11% Senior Subordinated Notes. That doesn’t look like enough “to significantly reduce Telex’s outstanding debt, increase its financial flexibility and improve its cash flow,” to quote the press release again.

Possible reasons for the delay include the disruption on Wall Street in the wake of September 11th, which could delay the completion of due diligence on the part of Telex’ lenders. Meanwhile, Telex has already missed one interest payment “due on September 17, 2001 under its 11% Senior Subordinated Notes and will not make the November 1, 2001 interest payment that is due on its 10-1/2% Senior Subordinated Notes,” as the latest announcement dutifully reminds the financial and business press. How long can a company in that kind of trouble go on postponing the day of reckoning? We’ll know more on Friday...