Charter Communications Inc. has offered a private debt exchange for $8.4 billion of its debt securities.

In a statement, Charter announced that the purpose of the private exchange offers is to improve its financial flexibility by extending maturities and reducing debt. Indeed, following an acquisition spree during the stock-market boom in late 1990s, Charter has been sitting on a debt load of about $19.2 billion.

One Charter subsidiary is offering $3.53 billion in new 11 percent senior secured notes due 2015 in exchange for old notes that mature in 2009 and 2010. Another is offering $4.26 billion of senior accreting notes due 2014 and 2015 in exchange for notes that mature in 2011 and 2012. The senior status of the notes would entitle investors who swap to potentially be paid earlier and recover more if Charter were to go bankrupt.

Observers, however, see the debt exchange as a delaying tactic to help Charter avoid that fate. “There have been liquidity concerns as a result of its debt,” Stifel Nicolaus & Co. analyst Ted Henderson told Reuters. “What this restructuring has done is buy them time to operationally execute out of their situation.”

Reportedly, the debt exchange would cut Charter’s long-term debt load by $1 billion to $1.5 billion, but how the company’s operations will improve is still an open question. Henderson told the wire service that Charter’s systems are less clustered than those of Comcast Corp. or Time Warner Cable, which makes them harder to service and maintain.

In addition, its high level of debt forces Charter to use its cash to pay out interest rather than in acquiring and retaining customers. As of June 30, Charter had $40 million of cash on hand.

Earlier this month, Charter named former Time Warner executive Neil Smit, the president of the cable giant’s America Online Access Business, as its new chief executive officer. His predecessor, Carl Vogel, resigned in January with about a year remaining on his contract.

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