Asia Global Crossing said in a news release that operations will continue uninterrupted during the reorganization and that customers will not experience any change in service. Asia Global Crossing’s management team and employee base will remain in place, it said.
Under the terms of the agreement, Asia Netcom will acquire substantially all of Asia Global Crossing’s operating subsidiaries, excluding Pacific Crossing Ltd. and related entities.
Asia Global Crossing’s principal vendors have agreed to restructure the obligations owed to them. The new company will assume these obligations as well as customer contracts and operating liabilities of the acquired entities. It is expected that, upon completion of the transaction, approximately $80 million of residual cash will be retained by Asia Global Crossing to pay its other creditors and to settle certain expenses in the Chapter 11 case and the Bermuda proceeding. No recovery is expected for Asia Global Crossing shareholders.
Asia Netcom will be funded by $120 million of new equity from the consortium members and additional bank financing, for the future operations of the company.
The parties expect the Asia Netcom transaction to close during the first quarter of 2003.
For more information, visit: www.asiaglobalcrossing.com