Just one week after a federal bankruptcy court judge approved the company's
reorganization plan, Global Crossing founder and board chairman Gary Winnick
announced that he is stepping down effective Tuesday.
In a resignation letter to the board, Winnick cited the completion of the
reorganization and the fact that he had managed to reimburse employees some $25
million in lost value in their retirement plans based on company stock.
"We wish to acknowledge Gary Winnick's role as founder of a company that
today provides advanced telecommunications services to thousands of customers
worldwide," the company said in a statement issued by the board. "The company's
plan of reorganization having now been approved, we respect his desire to make
Board members Jeremiah D. Lambert and Myron E. Ullman III are expected to be
named co-chairmen after an election Tuesday.
Global Crossing was among a cadre of broadband-network operators felled by
the Internet depression.
In January, the company filed for Chapter 11 reorganization. Just days later,
the Securities and Exchange Commission and the FBI announced that they were
investigating Global Crossing's accounting practices based on allegations made
by a former finance vice president. The FBI probe has since been dropped, but
the SEC probe is still active.
In August, the company announced that Hutchison Telecommunications Ltd. and
Singapore Technologies Telemedia Pte. Ltd. had agreed to pay $250 million to
acquire 61.5 percent of the reorganized company. The balance of the equity will
be given to creditors, leaving investors with nothing.
The company plans to emerge from Chapter 11 in the first half of