Liberty's Blog

Verizon Buys MCI

OK, lets see if I got this right.
MCI who was World Comm. because of a lot of lying and treachary went broke. The Stock became worthless. The creditors get issued new stock, as MCI, that has some value. Verizon buys MCI, for 6.8 Billion. The Creditors make a fine profit, the WorldCom stockowners get screwed, and the Worldcom executives are still not in jail.

MCI, based in Ashburn, Va., emerged from bankruptcy last spring after a
multibillion-dollar accounting scandal which nearly destroyed the company. Former chief executive Bernard Ebbers is currently being tried on criminal charges in the fraud, which boosted the profits WorldCom reported by hiding billions of dollars in expenses and inflating revenues. Former chief financial officer, Scott Sullivan, became the government’s lead witness against Ebbers after pleading guilty in the scandal.
The company, once worth $180 billion on the stock market, wiped away most of its debt in the bankruptcy reorganization.
But a combination of price wars, unfavorable regulatory changes, and competition from cell phones and Internet-based calling made it unlikely the company could survive on its own for the long term, so Capellas immediately began shopping the company around to prospective buyers.

posted by Liberty @ 6:42 AM