Newsgroup: it.economia.borsa
Titolo: Ma WCOM

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Wednesday May 8, 5:09 pm Eastern Time
Reuters Company News
WorldCom weighs options on credit lines - sources
By Jessica Hall
PHILADELPHIA, May 8 (Reuters) - WorldCom Inc. is in talks with lenders on
several funding options, including renewing a credit line and getting a new
$5 billion loan, but it may take time before a deal is hammered out, sources
familiar with the situation said on Wednesday.
WorldCom (NasdaqNM:WCOM - news; NasdaqNM:MCIT - news), the No. 2 U.S.
long-distance telephone and data services company, has been under pressure
in recent week as investors feared it may face a cash crunch and be unable
to pay off $1.6 billion in debts next year.
WorldCom's board of directors met on Tuesday to discuss options to extend
its credit pacts, restructure its debt and cut costs, sources familiar with
the situation said.
The company said last month it was in talks with its banks to renew a $2.65
billion credit line that expires in June. It also recently weighed the
option of taking out an additional $5 billion loan, sources said.
A spokesman for Clinton, Mississippi-based WorldCom declined to comment.
WorldCom faces price wars, stiffening competition and a review by the the
Securities and Exchange Commission on its accounting practices and the
company's personal loans to Bernie Ebbers, who quit last week as chief
executive.
Ebbers was replaced by Vice Chairman John Sidgmore, who said he would spend
the next month or two developing a new strategy.
"I don't think they have that luxury of time," said Davenport & Co. analyst
Drake Johnstone.
"I don't view their negotiations as easy for the company. If I were a banker
speaking to WorldCom, I would like to see the company take steps to shore up
their cash flow," Johnstone said.
Shares of WorldCom Group, the company's main Internet and data unit, closed
at $2.15, down 6 cents, or 2.7 percent. The stock, which has fallen more
than 80 percent over the past 12 months, had spiked 20-percent on Tuesday
after media reports said WorldCom may be successful in getting a new loan
agreement.
Shares of MCI Group, the company's residential long-distance telephone
business, added 22 cents, or 6.96 percent, to close at $3.38 on Nasdaq.
WorldCom bonds rose about 2 cents on the dollar on Wednesday, traders said,
but remain at distressed levels despite carrying investment grades. At least
two big Wall Street banks now trade them off their "distressed" bond trading
desks, people familiar with the matter have said.
DEAL COULD TAKE TIME
It may take some time for a deal to be hammered out due to WorldCom's
reduced growth outlook and management changes, and the overall reluctance of
investors to wade into the telecom sector, analysts said.
Earlier this year, rival Qwest Communications International Inc. (NYSE:Q -
news) spent several weeks in negotiations with its lenders to amend terms of
its credit agreement.
Analysts expect WorldCom to slash its already reduced capital spending
budget by another $1 billion, cut the dividend paid on its MCI Group stock,
and cut more jobs to save money.
It also could repurchase $1.7 billion in debt and amend the terms of its $2
billion accounts receivable securitization facility, said Kaufman Bros.
analyst Vik Grover. The company has said it would sell assets before it
considered buying back debt.
SECURED OR UNSECURED?
If the bank negotiations take several weeks, as expected, WorldCom will
likely exercise its option to convert the credit line into a loan maturing
in June 2003, sources said.
WorldCom Chief Financial Officer Scott Sullivan last month said the company
was "highly, highly, highly" confident it would be able to renew the $2.65
billion facility without having to put up assets as collateral. Recent media
reports, however, said WorldCom may be required to secure the credit line
with its assets as collateral.
WorldCom has denied it has a liquidity crisis, saying it merely suffered
from the perception of one. The company has about $1.6 billion in cash, and
expects to generate about $1 billion in free cash flow this year. It also
could sell about $2 billion in assets to raise cash, if needed.
It has $1.6 billion in loans to payoff in 2003, and $27.9 billion in total
debt.
Rating agency Standard & Poor's has said it may cut WorldCom's A-3
short-term corporate credit rating. A downgrade to below investment grade
could jeopardize WorldCom's $2 billion accounts receivable securitization
program, which analysts said would hurt its cash position.
(Additional reporting by Jonathan Stempel in New York)