Should Paul Allen Sell His Yacht?

One of the rare billionaires not selling his yacht is Paul Allen, whose $200 million, 414-foot Octopus was most recently the site of George Soros‘s wild New Year’s Eve. But just because he’s not selling the yacht right now doesn’t mean he won’t need to or shouldn’t.

Octopus, which has two helicopters, seven boats, a submarine, a remote controlled vehicle that explores the ocean floor and a staff of 60, is reportedly a $384,000 a week expense (that works out to $20 million a year). While you might think Allen could easily afford such expensive upkeep, his cable company Charter Communications (CHTR) isn’t doing so hot.

In fact, it’s massive debt load may force the company to file for bankruptcy this year, speculates The Hollywood Reporter.

THR: The St. Louis-based company has long been the most indebted major cable firm, with net debt of slightly more than $21 billion as of Sept. 30, and it has said that it might need to go into bankruptcy to deal with that burden…

“Charter is surviving by using debt exchanges to push back maturities,” Gimme Credit analyst Shelly Lombard said in a recent report. “Even at the current revenue growth rate, Charter won’t be able to grow into its capital structure.” She predicts that the company might need to sell “a considerable amount of assets to avoid bankruptcy.”

Just before Christmas, Charter said it asked longtime financial advisor Lazard to start talks with bondholders to boost its financial flexibility.

Other ratings agencies also suggested that bankruptcy might be the only way for Charter to work out its debt problems.

We have a feeling selling the yacht would help alleviate Charter’s debt, and considering that Allen has lost $30 million in CHTR stock over the past year, he may soon need to.

See Also: George Soros’s Wild New Year’s Eve
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