Sidgmore: We will survive

WorldCom CEO John Sidgmore today said that the company is aiming to come out of Chapter 11 sometime early next year.

At a press conference this morning, following last night’s bankruptcy filing, in the U.S. Bankruptcy Court for the Southern District of New York, Sidgmore pointed to several U.S. companies including Continental Airlines, Southland Corp. and Texaco that have used Chapter 11 to emerge as a stronger company.

“We will still have the best set of assets in the telecommunications industry,” he said.

Under the company’s plan of reorganization, WorldCom is hoping to keep most of its assets.

“If our plan is successful, the company will come out essentially intact,” he said. “Our plan will include keeping the core intact.”

The filing comes less than a month after the company revealed that an internal audit had discovered $3.8 billion in misallocated expenses, which inflated revenues over a period of five quarters. At the time, the company said it had several billion in cash and would not be seeking protection.

Since then, however, WorldCom’s bond plummeted, cutting off its access to the capital markets. At the same time, Sidgmore said, most vendors began a significant change in their payment policies, which led to the bankruptcy filing.

“In a strange way, entering Chapter 11 we are more stable,” he said.