MCI is a step closer to emerging from the largest bankruptcy in U.S. history, after Sprint and others withdrew objections to the troubled telecom’s reorganization plan, court records show.
The dissenters, peeved that certain classes of creditors received special treatment under the proposal, were satified after MCI raised payouts.
In addition to Sprint , AT&T
and 13 states, including California, New York, and Illinois, were among those protesting.
“The company expects to receive final confirmation of the plan in the next couple of weeks,” MCI spokeswoman Julie Moore told internetnews.com
But the latest developments don’t mean MCI is home free.
The Massachusetts department of revenue yesterday requested financial documents from former WorldCom CFO Scott Sullivan and the company’s outside auditor KPMG to determine if the company owes corporate taxes. A spokesman for the agency was not immediately available for comment.
And although AT&T dropped its objection to the reorganization plan, it is still pursuing fraud charges related to MCI’s method of routing calls.
Meanwhile, Ashburn, Va.-based MCI named Nancy Higgins as its “chief ethics officer.” Higgins held a similar position with aerospace giant Lockheed Martin.
The hiring is part of the company’s effort to restore its tarnished image. At an industry conference in Boston last week, Richard Breeden, the man appointed to put MCI on ethical footing, blamed WorldCom’s former CEO, managers and directors for the collapse of the company.
“Bernie Ebbers was as incompetent and unqualified to be a CEO as anyone who has ever held that post,” Breeden said.
WorldCom directors, who gradually ceded power to Ebbers and overlooked or ignored fraud of historic proportions, did not escape Breeden’s wrath either. Few could claim to be independent, he said. One was apparently only inserted in the post because he was Ebbers’ neighbor.
A chief ethics officer, as well as company pledge and numerous accounting safeguards, are among the recommendations Breeden made for MCI as it tries to steer out of the largest bankrupcy in U.S. history.
If the company’s plan receives a judge’s approval, the company could be out of bankruptcy Jan. 2, 2004.
