Global Crossing succumbs to telecom crash
Fibre optics communications company Global Crossing has become the biggest victim of the telecoms crash, filing for Chapter 11 bankruptcy protection yesterday.
The company, which was once worth $50bn (£36bn) is now in debt, owing more than $12bn (£8.5bn).
Over-investment in global internet networks and the slowdown in traffic on the world wide web causing a slump in demand for global communications and is believed to have brought Global Crossing to its knees.
Problems at the telecom might be eased after it forged a deal with Asian investors Hutchinson Whampoa and Singapore Technologies Telemedia. Under the arrangement, the company will receive a cash injection of $750m (£532m) which could help it come out of the red.
Andersen has been the company’s auditor since it listed on the US Nasdaq in August 1998. Last year Global Crossing paid Andersen £2.3m in audit services and a further £3m in non-audit services.