Judge approves MCI plan
- By Michael Hardy
- Nov 02, 2003
A federal bankruptcy judge has approved telecom provider MCI's reorganization plan, clearing the way for the company to emerge from Chapter 11 bankruptcy protection.
However, the company, also called WorldCom Inc., could still be banned from taking on new federal contracts. The General Services Administration has not yet ruled on a recommendation that it be debarred, a GSA spokeswoman said.
U.S. Bankruptcy Court Judge Arthur Gonzalez approved the plan late Friday. The ruling strips away much of the company's debt.
Michael Capellas, MCI chairman and chief executive officer, said Gonzales' approval of the plan is a tribute to the company's employees and customers. "Against all odds, we have reached our confirmation faster than anyone expected," he said in a statement.
MCI's competitors have previously expressed concerns that a streamlined MCI could emerge from bankruptcy with a competitive advantage due to its reduced debt burden.
"AT&T has consistently sought a level playing field for all, and the assurance that MCI/Worldcom will be held to the same standards as every other marketplace participant," said an AT&T spokesman in response to Friday's ruling. "AT&T never sought to deny MCI a fresh start under the bankruptcy rules."