CLINTON - WorldCom Inc. stockholders were told Friday the company will restore value and investor confidence by becoming simpler and leaner, a process requiring the sale of unproductive assets and the elimination of thousands of jobs.
Chief executive John Sidgmore told the 500 or so people attending the telecommunications company's annual shareholder meeting that he'll complete a strategic plan in the next few weeks.
"I can't change the past, but I'll tell you I'm really focused on the future," said Sidgmore, who replaced ousted CEO and WorldCom founder Bernie Ebbers in April.
Some were disappointed Sidgmore didn't offer more specifics during the hour-long gathering. Several shareholders also voiced concerns when WorldCom officials said they may not close a deal for $5 billion in critical new loans by the end of June, as the company previously stated.
Sidgmore said he's already made public the crux of the company's new blueprint: sell non-performing assets, including operating units and real estate, and reduce the capital expenditures by $1 billion this year.
He told reporters afterward the restructuring will involve job cuts through layoffs and attrition. He said a report last week that as many as 16,000 positions - some 20 percent of the work force - could be eliminated was "in the range, possibly a little less."
The meeting was at times contentious, but Sidgmore and other company executives downplayed concerns about liquidity and WorldCom's $30 billion in debt and said the situation was not as ominous as some reports have stated.
Chief financial officer Scott Sullivan said the company, which will keep its headquarters in Clinton, has more than $3 billion in cash, far more than enough to cover $60 million in bond debt owed this year.
One shareholder said he was disappointed the company couldn't guarantee the $5 billion credit facility.
Sullivan responded by saying WorldCom had the support of the top three banks involved, but negotiations were continuing. He said the goal was to arrange a deal with minimum restrictions on accessing the money.
"Whether this deal gets done in June, July or the beginning of August, it's most important that it get done on our terms," Sullivan said.
Already under Sidgmore, the former vice chairman, the company has decided to exit the wireless resale business and dump its MCI tracking stock and dividend payments.
He said those adjustments should save the company $1 billion a year.
Sidgmore said much of his time of late has been spent reviewing the full list of WorldCom assets and identifying those that are expendable.
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