Hawaiian Telcom Communications Inc. should name the source of a $300 million senior loan in a proposed turnaround plan, the U.S. Justice Department told a judge, Bloomberg News Service reported.

Assistant U.S. Trustee Tiffany Carroll yesterday put the loan’s missing source atop a list of comments faulting the outline of Hawaiian Telcom’s plan in a filing in U.S. Bankruptcy Court in Honolulu. Under the plan, about a billion dollars in debt would be converted into equity in the reorganized company.
The U.S. Trustee’s office said the so-called disclosure statement also should fully describe a proposed employee compensation plan and shouldn’t protect Hawaiian Telcom’s successor from claims that arose before the bankruptcy.
Hawaiian Telcom, with 1,400 workers, filed for bankruptcy Dec. 1, listing assets of $1.35 billion. It blamed the filing partly on transition difficulties after Carlyle Group, a Washington- based private-equity firm, bought the company from Verizon Communications Inc. in 2005 for $1.6 billion.