Feeds

Chapter 11 looms For WorldCom

Bonded labour

  • alert
  • submit to reddit

Internet Security Threat Report 2014

ComputerWire: IT Industry Intelligence

WorldCom Inc is trying to bash out a massive debt-for-equity swap with its bondholders, as the company battles to survive. Wall Street Journal reported sources close to the talks as saying Friday that holders of $26bn of bonds are talking to WorldCom management over the potential deal, which would be executed under the protection of Chapter 11.

The carrier, which revealed two weeks ago it inaccurately booked $3.8bn over the last five quarters, owes its creditors $32.8bn, the majority of which is due its bondholders. The company has up to $5.75bn in debt repayments due in the next year, reports said.

Any swap of debt for equity would allow the company to function as a regular business, unburdened by the huge debt, but would likely leave WorldCom common shareholders with next to nothing. The company says it is still talking to its banks, which it owes some of the debt, to figure out additional funding.

Having learned lessons from the Enron Corp scandal, regulators are currently all over WorldCom. The beleaguered carrier is currently being investigated by the Securities and Exchange Commission, Congress, and the US Justice Department, over allegations of fraud. The company fired its CFO following the uncovering of the accounting errors.

© ComputerWire

Providing a secure and efficient Helpdesk

More from The Register

next story
Facebook, Apple: LADIES! Why not FREEZE your EGGS? It's on the company!
No biological clockwatching when you work in Silicon Valley
Doctor Who's Flatline: Cool monsters, yes, but utterly limp subplots
We know what the Doctor does, stop going on about it already
'Cowardly, venomous trolls' threatened with TWO-YEAR sentences for menacing posts
UK government: 'Taking a stand against a baying cyber-mob'
Happiness economics is bollocks. Oh, UK.gov just adopted it? Er ...
Opportunity doesn't knock; it costs us instead
Arab States make play for greater government control of the internet
Nerds told to get lost in last-minute power grab bid at UN meeting
Zippy one-liners, broken promises: Doctor Who on the Orient Express
Series finally hits stride, but Clara's U-turn is baffling
Don't bother telling people if you lose their data, say Euro bods
You read that right – with the proviso that it's encrypted
Apple SILENCES Bose, YANKS headphones from stores
The, er, Beats go on after noise-cancelling spat
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Why cloud backup?
Combining the latest advancements in disk-based backup with secure, integrated, cloud technologies offer organizations fast and assured recovery of their critical enterprise data.
Win a year’s supply of chocolate
There is no techie angle to this competition so we're not going to pretend there is, but everyone loves chocolate so who cares.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Intelligent flash storage arrays
Tegile Intelligent Storage Arrays with IntelliFlash helps IT boost storage utilization and effciency while delivering unmatched storage savings and performance.