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Posted on 08/09/2002 8:46:14 AM PDT by flamefront
MADISON, N.J., Aug. 9 /PRNewswire/ -- Global Crossing today announced that it has signed a definitive agreement under which Hutchison Telecommunications Limited (Hutchison), a wholly owned subsidiary of Hutchison Whampoa Limited, and Singapore Technologies Telemedia Pte. Ltd. (ST Telemedia) will invest a total of $250 million for a 61.5 percent majority interest in a newly constituted Global Crossing on its emergence from bankruptcy. Global Crossing's creditor groups support the agreement.
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The agreement was approved today in a hearing before the Bankruptcy Court for the Southern District of New York.
Global Crossing is also preparing a Chapter 11 plan of reorganization. Global Crossing expects to file its plan in September and to emerge from bankruptcy in early 2003, subject to satisfying various contractual closing conditions, including regulatory approvals and confirmation of its plan of reorganization by the bankruptcy court.
The terms of the Hutchison and ST Telemedia agreement provide that Global Crossing's banks and creditors will receive 38.5 percent of the common equity in the newly constituted Global Crossing, $300 million in cash and $200 million of new debt in the form of senior notes. Existing common equity and preferred shareholders of Global Crossing will not participate in the new capital structure.
Under the agreement, Global Crossing will retain its UK national business, its conferencing division, and Global Marine -- three businesses which it had previously considered selling in order to maximize its cash position. Customers of these businesses, as well as Global Crossing's other customers, can expect service to continue without disruption.
The agreement with Hutchison and ST Telemedia follows several months of discussions with a large number of bidders. After reviewing and negotiating all the bids submitted, Global Crossing and its creditors entered into separate negotiations with Hutchison and ST Telemedia. These negotiations resulted in the agreement announced today. As a result of the agreement, Global Crossing has cancelled the auction scheduled for August 14, 2002.
"This is a textbook model for a successful strategic investment," said Mr. John Legere, CEO of Global Crossing. "Hutchison Telecommunications and Singapore Technologies Telemedia are highly respected telecom companies with assets and skills that complement Global Crossing's unmatched global network. With our turnaround well under way, and the support of strong new strategic partners, Global Crossing is poised to become the global leader providing networking services to enterprises and carrier customers in more than 200 of the world's top cities."
Mr. Canning Fok, Group Managing Director of Hutchison Whampoa, said, "We have confidence in the Global Crossing management team and look forward to working with them. Global Crossing presents an attractive business prospect for Hutchison and our investment in the company, which owns substantial broadband network capacity, is in line with our vision to be a leading global telecommunications player."
"Customers will be the real winners in this agreement," said Mr. Lee Theng Kiat, President and CEO of ST Telemedia. "Our three companies will be able to provide continuity on Global Crossing's international networks and expanded service offerings to benefit all our customers. As the telecom market stabilizes, there will be significant opportunities for the new Global Crossing, its creditors and employees. This investment will accelerate ST Telemedia's goal to become a significant global data and IP-centric communications group."
The Blackstone Group, L.P. and Weil, Gotshal & Manges LLP provided advice and counsel to Global Crossing regarding the agreement announced today.
ABOUT GLOBAL CROSSING
Global Crossing provides telecommunications solutions over the world's first integrated global IP-based network, which reaches 27 countries and more than 200 major cities around the globe. Global Crossing serves many of the world's largest corporations, providing a full range of managed data and voice products and services. Global Crossing operates throughout the Americas and Europe, and provides services in Asia through its subsidiary, Asia Global Crossing.
On January 28, 2002, Global Crossing and certain of its affiliates (excluding Asia Global Crossing and its subsidiaries) commenced Chapter 11 cases in the United States Bankruptcy Court for the Southern District of New York and coordinated proceedings in the Supreme Court of Bermuda. On the same date, the Bermuda Court granted an order appointing joint provisional liquidators with the power to oversee the continuation and reorganization of the Bermuda-incorporated companies' businesses under the control of their boards of directors and under the supervision of the U.S. Bankruptcy Court and the Supreme Court of Bermuda. On April 23, 2002, Global Crossing commenced a Chapter 11 case in the United States Bankruptcy Court for the Southern District of New York for its affiliate, GT UK, Ltd. On August 4, 2002, Global Crossing commenced a Chapter 11 case in the United States Bankruptcy Court for the Southern District of New York for its affiliate, SAC Peru Ltd. Global Crossing does not expect that any plan of reorganization, if and when approved by the Bankruptcy Court, would include a capital structure in which existing common or preferred equity would retain any value.
Please visit www.globalcrossing.com or www.asiaglobalcrossing.com for more information about Global Crossing and Asia Global Crossing.
CONTACT GLOBAL CROSSING:
Press Contacts Becky Yeamans + 1 973-410-5857 Rebecca.Yeamans@globalcrossing.com
Tisha Kresler + 1 973-410-8666 Tisha.Kresler@globalcrossing.com
Kevin Burgoyne Latin America + 1 305-808-5925 Kevin.Burgoyne@globalcrossing.com
Mish Desmidt Europe + 44 118-908-6265 + 44 7771-66-84-38 Mobile Mish.Desmidt@globalcrossing.com
Analysts/Investors Contact Ken Simril + 1 310-385-3838 investors@globalcrossing.com
It is also a classic way for the Chinese to wage a successful strategic warfare before the first shot is ever fired by them. Insanity runs amok, and the Island Nations are dwelling carelessly.
If I had the cash, as an American, I would counter bid the hell out of it.
GlobalCrossing
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Clinton Democrats Sued Over Global Crossing
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House Panel to Seek Global Crossing Documents
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Ex-Governor to Look Into Union Stock Deal [AFL-CIO / Global Crossing]
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Global Crossing Funded Anti-speech Incumbents
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Global Crossing & the Art of Effective Campaign Contributions [Free Republic]
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Quiet Global Crossing Board Member: Former Secretary of Defense
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Good. I no longer do. So Don't say anything more then. At first I just assumed you were being deliciously cynical, but then it became evident as the thread ran on that you were serious. You have become careless about our security. Think about this: Does Karl Rove care more about VOTES or the nuts and bolts of National Security? He proved which it was in the Viques Naval base dispute where he traded a very clearly irreplaceable national security asset worth $14 billion, for trying to mollify Jesse Jackson and the eco-`communists in Puerto Rico and the Puerto Ricans in NYC...and all in his phantasmical world the garnering of their votes. [ It will never happen ] And who does GWB listen to EVERY DAY and NEVER make fun of or defy? It's Karl Rove and Andrew Card. Even if we could trust GWB, when presented with all the facts to do the right thing, he has surrounded himself with politically-minded people who really don't see security as a NEED and a Constitutional Mandate of the office... but merely one more interest-group constituency to be placated!
And if those in the Security phalanx have the temerity to get out of line because they won't kow-tow to the decrees of political mavens, then they are vilified and marginalized in the tradition of Bill Clinton. Just look at GWB's continuing deal with the Clintons and Daschle to not prosecute...in exchange for WHAT????
In any event, the unsettling security facts that undermine what the authors of the big political schemes and deals inside the West Wing have going ...WILL BE FILTERED OUT from the President's daily brief. You can bet the bank on it.
Move along, nothing to see here.
The reds will control the international internet and communications backbone!
AMERICA'S CHINA SYNDROME
Beijing to acquire
espionage network?
Global Crossing deal could provide army with secure data transmission
Posted: February 22, 2002
1:00 a.m. Eastern
By Jon Dougherty
© 2002 WorldNetDaily.com
A Chinese firm whose CEO has well-established ties to the People's Liberation Army is making a bid for a worldwide telecommunications company that could give Beijing a global spy network for transmitting intelligence.
The company, Global Crossing ? which recently filed for bankruptcy protection ? has a worldwide fiber-optics route that connects all continents.
Successful acquisition of the network "would provide communist China with a worldwide and very capable spy network of data communications," according to one company official who requested anonymity.
"Global Crossing has a fiber-optic network that connects Europe, Asia, Australia, North America, South America and Africa. Any communications network can be used to commit espionage if given the correct tools to do it with," the company official told WND.
"As long as you have the secure equipment from end to end while transmitting data, you can use communications in a secure environment," the official said. "The Global Crossing network would give Hutchison Whampoa ? quality data transmissions over its undersea fiber-optic network.
"Sometimes it's difficult to get quality data transmissions from continent to continent without interruptions or capacity loss. Global Crossing's network has mind-boggling capacity," said the official.
In a Jan. 28 statement, Global Crossing officials announced that Hutchison Whampoa, along with Singapore Technologies Telemedia, had signed a letter of intent "for a $750 million cash investment for a joint majority stake in the company's equity in connection with a restructuring of the company's balance sheet."
Hutchison's connections to the Chinese army were established in the 1990s.
In testimony to the Senate Armed Services Committee Oct. 22, 1999, Rep. Dana Rohrabacher, R-Calif., said the company's chairman, Li Ka-Shing, is "closely associated with the Beijing regime and has a history of acting as a source of funding or acting as an intermediary in deals for the People's Liberation Army."
Rohrabacher complained that "the Clinton administration, including defense and intelligence agencies, [had] publicly stated that they have no knowledge of a connection between Li Ka-Shing" and the PLA.
During testimony, the California Republican entered into the record "unclassified documents by U.S. intelligence agencies, the U.S. Bureau of Export Affairs, the U.S. Embassy in Beijing and the Rand Corporation that identify Li Ka-Shing and [Hutchison] as financing or serving as a conduit for communist China's military to acquire sensitive technologies and other equipment. ?"
Li, U.S. officials said, was also founder of the China International Trust and Investment Corporation, a firm that "does enter into business partnerships with and provide logistical assistance to the People's Liberation Army," according to a 1997 Rand Corporation study.
Other strategic military experts say they are concerned about Hutchison's control over former American ports at both ends of the Panama Canal, a strategic waterway in Central America no longer owned by the United States.
"My concern is that this company (Hutchison) is controlled by the communist Chinese," said retired Adm. Thomas H. Moorer in testimony before the Senate Foreign Relations Committee June 16, 1998. "And they have virtually accomplished, without a single shot being fired, a stronghold on the Panama Canal, something which took our country so many years to accomplish."
Other lawmakers also worry about the loss of the canal, transferred back to Panama in January 2000.
Says Rep. Bob Barr, R-Ga.: "I think the geopolitical significance of the Panama Canal in 1999 is the same as it has been for the past 85 years ? critical."
There are also political ramifications surrounding Global Crossing. The head of the Democratic National Committee, Terry McAuliffe, turned a $100,000 investment in the fiber-optics firm into an $18 million profit before it filed for bankruptcy protection.
Critics are comparing McAuliffe's profiteering to the actions of executives of failed energy giant Enron Corp., which filed for bankruptcy Dec. 2 after concealing massive losses.
McAuliffe managed to arrange a golf date between Global president Gary Winnick and President Bill Clinton before the latter left office. Shortly thereafter, Winnick contributed $1 million to Clinton's Little Rock, Ark.-based presidential library, the Washington Times reported yesterday.
Global then began negotiations with the Clinton administration for a $400 million Defense Department contract. Global won the contract last July, but the Bush administration rescinded the contract a month later after losing bidders raised a fuss over the bidding process, the paper said.
"The point is not that McAuliffe did anything wrong necessarily in Global Crossing ? but that he tried to make a political issue out of Enron to use against Republicans and President Bush in particular ? and did it gleefully without compunctions," David Norcross, a lawyer and former Republican National Committee general counsel, told the paper.
Related stories:
Speaker appoints top China lobbyist
Clinton knew China's Panama play in 1996
Hong Kong tycoon's secret trade deals
McAuliffe's new Democratic Party Plank:
"You hypocrite, first take the plank out of your own eye, and then you will see clearly to remove the speck from your brother's eye." Matt. 7:5
Other strategic military experts say they are concerned about Hutchison's control over former American ports at both ends of the Panama Canal, a strategic waterway in Central America no longer owned by the United States.
"My concern is that this company (Hutchison) is controlled by the communist Chinese," said retired Adm. Thomas H. Moorer in testimony before the Senate Foreign Relations Committee June 16, 1998. "And they have virtually accomplished, without a single shot being fired, a stronghold on the Panama Canal, something which took our country so many years to accomplish."
The Global Crossings control isn't so tangible. Just take some time and think about it.
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