DirecTV Latin America Eyes Chapter 11 Exit

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From our friends at SkyReport.com

DirecTV Latin America filed its proposed plan of reorganization with the U.S. Bankruptcy Court in Delaware, a big step towards emerging from Chapter 11 in early 2004.

The proposed plan has Hughes and Darlene Investments, an affiliate of Venezuela-based Cisneros Group of Companies, as company members. Holders of general unsecured claims will receive cash distributions equal to 20 percent of allowed claims, the company said. The distributions will be funded from operating cash flow and a new credit facility provided by Hughes.

Under the plan, Hughes will receive more than 80 percent of the reorganized company's equity after emerging from Chapter 11. Darlene will receive a minority share.

DirecTV Latin America filed for Chapter 11 bankruptcy in March to address its financial and operational challenges. The filing applied only to the U.S. entity and didn't include any operating companies in Latin America and the Caribbean, which have continued regular operations.

The service has 1.5 million subscribers in 28 countries.