WorldCom Inc., the bankrupt and disgraced telecommunication company, has tapped two executives from the corporate restructuring company, AlixPartners LLC, to assist the ailing company with its restructuring and financial difficulties, it was announced Monday.
John S. Dubel has been named chief financial officer (CFO) and Gregory F. Rayburn has been named chief restructuring officer (CRO), WorldCom said in a statement. Both will report directly to John Sidgmore, WorldCom president and chief executive officer (CEO), the company said.
Rayburn and Dubel will be charged with managing WorldCom's restructuring, including negotiating with existing creditors, evaluating proposals, overseeing the development of financial projections, disseminating appropriate information to stakeholders and overseeing the sale of any non-core assets, WorldCom said.
The appointments are subject to approval from the bankruptcy court, the company said.
WorldCom filed for protection under Chapter 11 of the U.S. Bankruptcy Code on July 21, in the U.S. Bankruptcy Court for the Southern District of New York, after it was forced into issuing a US$4 billion restatement of its financial reports due to questionable accounting practices.
WorldCom fired its former CFO, Scott Sullivan, when its accounting irregularities were first reported in June. Its previous president and CEO, Bernard Ebbers resigned in late April in the face of mounting debts, a U.S. Securities and Exchange Commission (SEC) investigation and layoffs.
Also in June, the SEC filed a lawsuit against the Clinton, Mississippi, company, charging WorldCom with fraud and asking a court to block the destruction of documents and the payment of extraordinary bonuses to executives. WorldCom has debt estimated at $32.8 billion, several thousand corporate customers, serves around 20 million consumers, runs the world's biggest Internet network and has 60,000 employees worldwide.
AlixPartners, founded in 1981 and headquartered in Southfield, Michigan, just outside of Detroit, changed its named from Jay Alix & Associates at the beginning of this month, according to the company's Web site.
Rayburn, an employee at AlixPartners since Aug. 2000, most recently served as both CEO and CRO in the successful restructuring of Sunterra Corp., WorldCom said.
Prior to joining AlixPartners earlier this year, Dubel ran his own turnaround company and served as CRO at CellNet Data Systems, now SchlumbergerSema Ltd., WorldCom said.