<Global Crossing became the largest telecom in U.S. history to seek bankruptcy-court protection when it filed on Jan. 28. As part of a reorganization plan announced the same day, the company agreed to sell 79% of its shares to two Asian outfits, Hutchinson Whampoa and Singapore Technologies Telemedia, for $750 million in cash. Under the plan, the banks, bondholders, and trade creditors that are owed nearly $8 billion would get $300 million in cash, $800 million in new debt, and the remaining 21% of the company. Global Crossing's current shareholders would get nothing.>
Message 17051097
Well, DWB, that's better than a poke in the eye with a burnt stick [for creditors].
In fact, it seems like a reasonable deal, [given the current market price of the debt], but I thought there was a lot more than $8 billion in debt.
According to this link, nytimes.com there is $12.4 billion in debt <... Hamilton, Bermuda-based Global Crossing filed for protection under Chapter 11 of the bankruptcy code on Jan. 28 in the fourth-largest corporate insolvency in U.S. history. It listed assets of $22.4 billion and $12.4 billion in debts....>
I wonder which report is true. I thought the debt is more like $15 billion.
While shareholders are understandably angry, if there isn't a better offer for the assets, then that's all they are worth. If the creditors aren't paid out, then I don't see why the shareholders should get anything at all. That's how debt works and everyone [who is investing and taking on debt via their companies] should know that.
Mqurice |
