WorldCom becomes MCI

By Alun Williams

Posted on 14 Apr 2003 at 16:10

The troubled networking services company WorldCom has changed its name back to MCI and filed for 'fast track' Chapter 11 reorganization.

Its proposed Plan of Reorganization has been filed with the U.S. Bankruptcy Court for the Southern District of New York.

Back in January, the company committed to a 100-day reorganisation plan, and this has concluded in today's filing. 'We committed to file our Plan of Reorganization by April 15 and we delivered,' claims MCI's Chairman and CEO Michael Capellas.

'Today's accomplishments are a tribute to our management team, advisors and major creditor constituencies. It is also an example of the tremendous will-to-win of the MCI employees, who worked with an outrageous sense of urgency.'

The plan has been approved by the company's major creditors. It includes a proposed capital structure for the company that will include approximately $3.5bn of debt.

Capellas, of course, was formerly CEO of Compaq. He moved to Worldcom in November 2002. 'Our company has demonstrated a new fast and focused attitude and a commitment to emerge from Chapter 11 later this year as a leaner, stronger competitor,' he added in an official statement. 'From this day forward, our focus will be on serving our customers, strengthening our core assets, executing on our three-year business plan, and solidifying our position as the industry's leading Internet Protocol communications provider.'

The company has promised to file a Disclosure Statement, explaining its plans in more details, later today. This will appear on www.mci.com, the URL to which www.worldcom.com now resolves.

It was back in June 2002 that Worldcom became engulfed in a $3.8bn accounting scandal and promptly faced fraud charges from the US Securities Exchange Commission. In July, it first applied for Chapter 11 bankruptcy, but managed to find $2bn in financing to keep it going through a restructuring process.