TOP 09 VANISHING COMPANIES IN 09 – II
…cont.
Year 2009 is the year of recession, in these tough times many companies vanishes while only few of them can resist the crises. Here are the lists of companies which will disappear in the year 2009. As per the research made by 24/7 Wall St. on some of the largest & well-known companies & listed down 09 companies which may disappear at the end of next year. These 09 companies are as follows:
6) The New York Times (NYT) has to repay $400 million in debt in the first half of 2009. It does not have the money. It plans to mortgage its headquarters, but it is uncertain what that will bring in an uncertain real estate market. The firm’s Boston Globe and regional newspaper operations lose money, so they will be hard to sell. NYT is controlled by the Sulzberger family which has super-majority voting shares. That won’t matter much when the company runs out of money. Another big media operation, perhaps News Corp (NWS) which owns The Wall Street Journal and The New York Post, will come in and auction off what it can and keep the flagship New York Times newspaper and NYTimes.com website.
7) Nortel (NT), the huge telecom equipment company, has already been mentioned as a firm which could file for bankruptcy. That may be a game to get creditors to cut down their demands. It could be that a huge contraction in the industry which is also undermining the fortunes of competitor Alcatel-Lucent (ALU) is pulling Nortel under. Nortel keeps losing money and has cut about as many people as it can and still stay in business. With the need for its products and services falling as the recession grows. Nortel has a pension obligation which may approach $3 billion. Selling divisions in a poor credit market will be hard. A bankruptcy filing would let a court run an auction.
Charter Communications (CHTR) has over $20 billion in debt. The cable business usually drives reasonable cash flow, but Charter has to upgrade its system to better compete with telecom companies. It does not have that money. Debt service is overwhelming operating income. Billionaire Paul Allen controls that company. The stock is down to $.15. Eighteen month ago, it was close to $5. Allen will get out while he can and sell to one of the other large cable companies. Charter recently said it is “exploring financial alternatives.”
9) Hovnanian (HOV) shares are down by 70% over the last year. Recently, the shares have been as low as $1.70, putting the company’s market cap at $171 million. The housing downturn may actually get worse as unemployment and foreclosures rise. The costs of credit default swaps on the homebuilder are way. JMP Securities recently commented that HOV is a “bankruptcy risk” due to debt and exposure in the hardest hit real estate markets. Liquidation with Hovnanian would probably be an auction of land and unsold homes.