Charter may seek bankruptcy

Charter Communications Inc., billionaire Paul Allen’s money-losing cable TV company, hired law firm Kirkland & Ellis and investment bank Lazard Ltd. to advise on a possible bankruptcy, people familiar with the matter said Friday.

Kirkland’s Rick Cieri is providing counsel, according to two people involved in talks on Charter’s strategy. Allen has also hired lawyers and financial advisors, the people said. If the St. Louis-based company decides in favor of bankruptcy, it may file as soon as next week, said one of the people, who declined to be identified because the discussions were private.

Charter said Thursday that it was working with bondholders on “financial alternatives” after missing an interest payment to lenders. The company is vying for customers with larger rivals and has more than $20 billion in debt, prompting Moody’s Investors Service to say last month that bankruptcy is “likely” unless Charter restructures it.

Major bondholders are also organizing for a possible bankruptcy filing, with senior noteholders hiring investment bank Houlihan Lokey, the people said. The Los Angeles-based firm has advised on some of the biggest debt restructurings of all time, including the Lehman Bros. Holdings Inc. and WorldCom Inc. bankruptcies.

Allen, co-founder of software behemoth Microsoft Corp., has held a controlling stake since 1998 in the company, which hasn’t turned a profit since going public a decade ago. Allen is represented by Nick Saggese of Skadden, Arps, Slate, Meagher & Flom in the talks and is being advised by Miller Buckfire & Co., the people said.