Williams comes out of bankruptcy, CEO resigns

Williams Communications’ long road to financial stability took a twist today as the company announced it has successfully emerged from bankruptcy. The company will not only change its name to WilTel Communications, to reflect its past, but its longtime president and a very integral part of its past, CEO Howard Janzen, has resigned from the company. No replacement for Janzen has been named.

“We can’t offer any further comment other than what has been released,” said a Williams spokeswoman, who commented that WilTel is carrying out a nationwide search for a replacement to Janzen.

Through the restructuring, Williams wiped itself clean of about $6 billion in debt. (Court clears Williams to proceed, Oct 1, 2002, http://telephonyonline.com/ar/telecom_court_clears_williams/index.htm)

The new company has emerged with a new $375 million credit facility and no other substantial debt. The company does have the existing $150 million investment from Leucadia National Corporation, which also paid $180 million in debt Williams Communications owed to its parent company, The Williams Companies. Shares of the original WCG are now worthless.

WilTel issued 50,000 shares for distribution of which 54% will go to unsecured creditors and 44% will go to Leucadia. The remaining 2% was “set aside for potential recovery by holders of securities-related claims,” according to a Williams release.

Just recently, Williams resolved its potentially disastrous conflict with its partner SBC Communications. SBC had expressed interest in terminating its relationship with Williams on the basis that Williams had changed ownership of the company. Both parties eventually agreed not to pursue litigation against each other.