Oak Industries Inc. said Friday that it wrote off an additional $80 million in the fourth quarter, wiping out its remaining equity and leaving the company with a negative net worth of about $23 million.
The troubled cable-TV equipment and media company also deferred $5.25 million in debenture interest payments due Friday and said it plans to restructure $230 million in debt in an attempt to reduce its $28-million annual interest expense.
But even if Oak's plan to restructure debt--through an exchange of notes, stock and warrants to be offered next week--is successful, the company said it will continue selling assets and arrange for additional secured financing to meet cash needs in 1985.
Among the assets to be sold soon are its ON TV subscription-television operations in Los Angeles and Chicago, according to Oak Chief Financial Officer Frank Astrologes.
ON TV in Los Angeles will be sold within the next few days to SelecTV, which has been in off-and-on negotiations with Oak for nearly two years.
Under terms of the proposed exchange offer, Oak would be allowed to pay interest in stock rather than cash, Astrologes said.
Saving cash, he said, "will allow us to stand firm and wait for the price that we want" for the Chicago television operations and other assets.
The Securities and Exchange Commission is investigating the circumstances surrounding at least one securities offering by Oak as well as possible conflicts of interest in Oak's contract-awarding process.
The company has reported losses in each of the last nine quarters and has taken millions in write-offs. Through the first nine months of 1984, Oak reported a loss of $29.5 million on sales of $315 million, compared to a loss of $99.6 million on sales of $322.9 million in the period a year earlier.
The company is expected to report an operating loss for the fourth quarter of 1984 in addition to the $80 million in write-offs, a spokesman said.
Interest payments on the $100 million of 10.5% convertible subordinated debentures due 2002 will be deferred until expiration of the proposed exchange offer, the company said.
Other securities affected are $100 million of 13.65% debentures due 2001 and $30 million in 11.625% subordinated debentures due 1998.
Oak also said it will restate financial results for 1982 and 1983 because of a "re-evaluation of information relating to adequacy of reserves."
The restatement will shift $50 million in losses from 1983 to 1982 and will result in a net loss of $46 million for 1982 and a loss of $116 million in 1983.
Earlier, the company had reported a profit of $4.1 million in 1982 and a net loss of $166.1 million in 1983.