Don't believe I have seen this posted here. Enron interested in GBLX? Makes for good reading. Jeff
library.northernlight.com
--------------------------------------------------------------------------------
GLOBAL CROSSING IN ACQUISITION FRENZY
--------------------------------------------------------------------------------
Story Filed: Thursday, November 04, 1999 10:22 PM EST
Nov. 04, 1999 (TELECOMS DEAL REPORT, Vol. 1, No. 5 via COMTEX) -- Global Crossing is getting ready to pounce on a number of acquisitions as it strives to join the telecoms global elite, according to a TDR source. And it does not stop there. The source added that Deutsche Telekom and the USA utilities company, Enron, will battle it out for control of Global Crossing. Meanwhile, the German incumbent is also linked to RSL Com and Energis.
USA-based Global Crossing is forcing the telecoms rumour mill to work overtime, following speculation that it may be interested in buying a whole myriad of operations, including Metromedia Fibre Network, USA long distance carrier, STAR Telecom, as well as Hutchison's stake in US GSM Network Voicestream Wireless.
Speculation arose after TDR discovered Global Crossing is expected to finalise its purchase of AT&T Communications UK within. "It is in the process of being sold, but negotiations are still going on. The deal is likely to be concluded next year," AT&T's Phil Coathup told TDR. "There has been a lot of interest from European and USA companies." But Coathup questioned why the USA company would want to acquire two UK companies, following its Pounds 1 billion purchase of Racal Telecom last month? Global Crossing snatched Racal from under Energis' nose, after the UK fixed line operator had virtually struck a deal with Racal, claiming it was after Racal's exclusive customer base.
Nevertheless, acquisitions sometimes carry a twist in the telecoms industry. Global Crossing may have major acquisitions planned, but Deutsche Telekom and Enron are thought to be interested in acquiring Global Crossing.
"Enron is interested in trading bandwidth, and given that Global Crossing has a lot of that, Enron may be interested," one telecoms analyst told TDR. "Would Deutsche Telekom be interested in Global Crossing? Again, you need end-to-end IP facilities to be a global player. Global Crossing would provide Deutsche Telekom with a means of doing that."
It is also alleged that Deutsche Telekom submitted a bid for Energis and RSL Com, a move that the German incumbent would neither confirm nor deny. The German incumbent uttered its standard, "we do not comment on speculation". However, Andreas Hoschket, a spokesperson at RSL Com failed to deny Deutsche Telekom's interest in the operator when probed by TDR.
"There's a certain amount of logic in that," the analyst said, "because they [Deutsche Telekom and Energis] are already partners in the UK. Most networks who aspire to be global IP providers need western European networks."
Global Crossing went on a spree last month, acquiring Frontier (as well as Racal), and is realising the benefits of the global telecommunications powerhouse. It has also announced that it is in the process of completing its offering of $1 billion aggregate liquidation preference of 6-3/8 per cent cumulative convertible preferred stock, convertible into common stock, based upon a conversion price of $45 per share -- due to be issued on 5 November 1999. The net proceeds from the offering are forecast to be $970 million.
Copyright ¸ 1999, Phillips Publishing International, all rights reserved. |
