It's Official - WCOME is filing Chapter 11 | |
Highlights (lowlights?):
* Hopes to come out of Chapter 11 protection within one year.
* Stockholders are likely wiped out (still not definite)
* $2 billion in debtor-in-possession funding guaranteed to keep operations running.
* Looks like the FCC won't have to step in to keep UUnet and the other "critical" pieces operational.
* Bondholders may luck out -- company is working on a debt-to-equity swap.
This is going to be one ugly re-org. Three years ago, the stock was well over $50. Bernie Ebbers is going to end up in jail. I believe that with thousands of employees that prosecutors will have no trouble finding a smoking gun memo regarding financing one of the acquisitions or moving income around. Much like Capone, the SEC and Congress are going to want to get Ebbers (still regarded as uncouth, boorish and a flim-flam man) as their example.
Know who is happy tonight? Or at least happier? Ken Lay. | 
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