Oct. 16, 2002, 2:40PM
Williams Communications to have new name
Reuters News Service
TULSA, Okla. - High-speed communications services company Williams Communications Group said today it emerged from Chapter 11 bankruptcy under a new name, and it will look for a new chief executive officer.
The company, which filed for bankruptcy in April in a bid to restructure about $6 billion in debt, now will operate as WilTel Communications Group Inc. It was one of several telecommunications carriers to buckle under slumping demand, a glut of network capacity and stiff competition.
The company said it emerged from bankruptcy with a new $375 million credit facility, and no other substantial debt obligations other than those related to its headquarters building.
As the new WilTel and other carriers such as FLAG Telecom Ltd., Teligent Inc. and McLeodUSA Inc. emerge essentially debt-free from bankruptcy, the struggling telecommunications company faces a new risk, analysts said.
"These companies who are emerging from bankruptcy no longer have the crushing debt load that many of their competitors still have. They have a lower cost structure, which conceivably gives them an edge in the competitive wars if they start to compete on price," said independent telecommunications analyst Jeffrey Kagan.
"The last thing this industry needs is a price war as it struggles to get back up on its feet," Kagan said.
However, other analysts have said the reorganized companies may have trouble attracting and retaining customers who have been spooked by the industry's financial troubles and accounting scandals. Skittish customers may flock to more established carriers such as AT&T Corp. or Sprint Corp. , rather than risk business with an emerging carrier.
The new WilTel canceled existing shares of Williams Communications stock, and issued 50 million shares of WilTel stock. The new shares will trade on the Bulletin Board under the symbol "WTELV."
About 54 percent of the new shares will be distributed to unsecured creditors, and 44 percent the shares will be owned by Leucadia National Corp. , which had agreed to purchase a minority stake in the reorganized company for about $330 million.
The remaining two percent of the new equity has been set aside for potential recovery by holders of securities-related claims.
Meanwhile, the company said Howard Janzen resigned as president, CEO and as a director. The board of directors will begin a search for a successor. Janzen, an engineer, has led Williams Communications since its formation in 1995 and led it through its April 2001 spinoff from Williams Cos. and now through its bankruptcy reorganization.
Park your Sub at the iHub - Bub; .....the experience might just "...float your boat..." !!!
Williams Communications to have new name
Reuters News Service
TULSA, Okla. - High-speed communications services company Williams Communications Group said today it emerged from Chapter 11 bankruptcy under a new name, and it will look for a new chief executive officer.
The company, which filed for bankruptcy in April in a bid to restructure about $6 billion in debt, now will operate as WilTel Communications Group Inc. It was one of several telecommunications carriers to buckle under slumping demand, a glut of network capacity and stiff competition.
The company said it emerged from bankruptcy with a new $375 million credit facility, and no other substantial debt obligations other than those related to its headquarters building.
As the new WilTel and other carriers such as FLAG Telecom Ltd., Teligent Inc. and McLeodUSA Inc. emerge essentially debt-free from bankruptcy, the struggling telecommunications company faces a new risk, analysts said.
"These companies who are emerging from bankruptcy no longer have the crushing debt load that many of their competitors still have. They have a lower cost structure, which conceivably gives them an edge in the competitive wars if they start to compete on price," said independent telecommunications analyst Jeffrey Kagan.
"The last thing this industry needs is a price war as it struggles to get back up on its feet," Kagan said.
However, other analysts have said the reorganized companies may have trouble attracting and retaining customers who have been spooked by the industry's financial troubles and accounting scandals. Skittish customers may flock to more established carriers such as AT&T Corp. or Sprint Corp. , rather than risk business with an emerging carrier.
The new WilTel canceled existing shares of Williams Communications stock, and issued 50 million shares of WilTel stock. The new shares will trade on the Bulletin Board under the symbol "WTELV."
About 54 percent of the new shares will be distributed to unsecured creditors, and 44 percent the shares will be owned by Leucadia National Corp. , which had agreed to purchase a minority stake in the reorganized company for about $330 million.
The remaining two percent of the new equity has been set aside for potential recovery by holders of securities-related claims.
Meanwhile, the company said Howard Janzen resigned as president, CEO and as a director. The board of directors will begin a search for a successor. Janzen, an engineer, has led Williams Communications since its formation in 1995 and led it through its April 2001 spinoff from Williams Cos. and now through its bankruptcy reorganization.
Park your Sub at the iHub - Bub; .....the experience might just "...float your boat..." !!!
.......According to the Great Pumpkin, ".....You're in .....iHub....., Charlie Brown....."!!!
Join the InvestorsHub Community
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
