Bermuda-based Global Crossing, which has an accumulated debt of over US$12 billion, filed for bankruptcy protection in January. Then, Singapore-based telecommunications services firm ST Telemedia and Hong Kong-based conglomerate Hutchison Whampoa Ltd announced their joint US$750 million rescue offer for the troubled firm.
ST Telemedia spokesperson Melinda Tan said today the company's position on the bid "remains unchanged", although Global Crossing had claimed that over 40 other companies are considering offers.
"We believe our proposal offers a fair value to the banks and creditors for the business and assets of Global Crossing as a whole," Tan added. "Moreover, our proposal is currently the only viable deal on the table."
On Monday, the US Bankruptcy Court approved the restructuring of Global Crossing's business, and set July 8 for the auction of the submarine cable owner, Reuters reported. Bids will be confirmed July 11.
The court also gave ST Telemedia and Hutchison until May 21 to submit a definitive offer for Global Crossing. Other potential buyers have until June 20 to table their proposals.
Should other parties prevail in the auction, Hutchison and ST Telemedia are entitled to a US$30 million breakup fee. Both companies had initially sought for US$40 million.
Global Crossing, whose assets are worth more than US$22.4 billion, had suffered from a slowing demand for voice and data services, tumbling prices and acute competition. It is currently facing probes by the US Securities and Exchange Commission and Federal Bureau of Investigation, as the company was alleged to have artificially boosted revenues through improper accounting practices.
Last week, in a hearing before a US congressional committee, Global Crossing's executives argued that its excess network capacity exchanges with other telecommunications providers were in keeping with standard accounting practices.
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