WorldCom Inc's creditors may force the company to sell its most profitable assets after the telephone and Internet carrier said it had US$7.18 billion in accounting irregularities, bankruptcy attorneys said.
"As confidence evaporates, it becomes more likely that the best way to restructure this company is to sell off the assets," said David Green, an attorney at law firm Salomon Green & Ostrow, which specializes in bankruptcy. "It becomes a question of people getting more nervous and distrustful of WorldCom."
WorldCom, and carrier of half of all Internet traffic, has said it could emerge from Chapter 11 mostly intact by January.
The company filed the largest US bankruptcy last month after revealing it hid US$3.85 billion in expenses and masked losses since last year. WorldCom disclosed US$3.33 billion in financial misstatements last night.
"I'm sure financial creditors would want to sell the whole company, take the money and go home," said Leonard Goldberger, a bankruptcy attorney at White & Williams LP and vice president of the American Bankruptcy Institute.
"Creditors who are suppliers would want to see the company continue operating because they want to continue selling their products to them."
Any decision to dismantle WorldCom by selling off its largest assets will be made by the creditor's committee, composed of banks, bondholders and suppliers owed money by the company.
Creditors will get the most return if the company emerges from Chapter 11 proceedings intact, said Daniel Golden of Akin, Gump, Strauss, Hauer & Feld, who represents WorldCom's creditor committee in the bankruptcy case.
Golden said WorldCom and the committee would look to sell some assets and that WorldCom risked losing the trust of some customers after its latest restatement. "Anytime you have an accounting restatement, there's an issue of the loss of confidence by customers," he said.
"There may be clearly be some assets that the company and the committee may decide to sell," Golden said.
WorldCom Chief Executive John Sidgmore has said the company doesn't plan to liquidate its largest assets, including the MCI Group long-distance business and the Uunet worldwide data network.
The company will try to sell small operations such as wireless-resale assets and holdings in Latin America and Europe, he said.
WorldCom is "still serving customers and this is not going to impact the high quality service that they receive from WorldCom. Our new management is committed to restructuring the company and emerging from bankruptcy," spokeswoman Sudie Nolan said.
The stock, delisted by the NASDAQ Stock Market last month, has tumbled from a high of US$62 in June 1999, wiping out more than US$100 billion in market value.
The government is aiming to recruit 1,096 foreign English teachers and teaching assistants this year, the Ministry of Education said yesterday. The foreign teachers would work closely with elementary and junior-high instructors to create and teach courses, ministry official Tsai Yi-ching (蔡宜靜) said. Together, they would create an immersive language environment, helping to motivate students while enhancing the skills of local teachers, she said. The ministry has since 2021 been recruiting foreign teachers through the Taiwan Foreign English Teacher Program, which offers placement, salary, housing and other benefits to eligible foreign teachers. Two centers serving northern and southern Taiwan assist in recruiting and training
WIDE NET: Health officials said they are considering all possibilities, such as bongkrekic acid, while the city mayor said they have not ruled out the possibility of a malicious act of poisoning Two people who dined at a restaurant in Taipei’s Far Eastern Department Store Xinyi A13 last week have died, while four are in intensive care, the Taipei Department of Health said yesterday. All of the outlets of Malaysian vegetarian restaurant franchise Polam Kopitiam have been ordered to close pending an investigation after 11 people became ill due to suspected food poisoning, city officials told a news conference in Taipei. The first fatality, a 39-year-old man who ate at the restaurant on Friday last week, died of kidney failure two days later at the city’s Mackay Memorial Hospital. A 66-year-old man who dined
‘CARRIER KILLERS’: The Tuo Chiang-class corvettes’ stealth capability means they have a radar cross-section as small as the size of a fishing boat, an analyst said President Tsai Ing-wen (蔡英文) yesterday presided over a ceremony at Yilan County’s Suao Harbor (蘇澳港), where the navy took delivery of two indigenous Tuo Chiang-class corvettes. The corvettes, An Chiang (安江) and Wan Chiang (萬江), along with the introduction of the coast guard’s third and fourth 4,000-tonne cutters earlier this month, are a testament to Taiwan’s shipbuilding capability and signify the nation’s resolve to defend democracy and freedom, Tsai said. The vessels are also the last two of six Tuo Chiang-class corvettes ordered from Lungteh Shipbuilding Co (龍德造船) by the navy, Tsai said. The first Tuo Chiang-class vessel delivered was Ta Chiang (塔江)
EYE ON STRAIT: The US spending bill ‘doubles security cooperation funding for Taiwan,’ while also seeking to counter the influence of China US President Joe Biden on Saturday signed into law a US$1.2 trillion spending package that includes US$300 million in foreign military financing to Taiwan, as well as funding for Taipei-Washington cooperative projects. The US Congress early on Saturday overwhelmingly passed the Further Consolidated Appropriations Act 2024 to avoid a partial shutdown and fund the government through September for a fiscal year that began six months ago. Under the package, the Defense Appropriations Act would provide a US$27 billion increase from the previous fiscal year to fund “critical national defense efforts, including countering the PRC [People’s Republic of China],” according to a summary