Case Study On WorldCom
Case study on WorldCom
THE WORLDCOM FRAUD:-
Presented By:
Pratik
WorldCom’s Background
• Awoke the sleeping giant by leading the telecom industry into profitability in the 90’s.
• During the 1990’s, WorldCom was deeply involved in acquisitions and completed several “mega-deals”
• Purchased over 60 firms in 2nd half of the 90’s
• WorldCom moved into Internet and data traffic
• Handled 50% of US Internet traffic
• Handled 50% of e-mails worldwide
WorldCom’s Background (cont.)
• Purchased MCI for $37 billion in 1997
• Not allowed to purchase Sprint in 2000 because of antitrust regulation.
• In 1999 revenue growth halted; stock price dropped
• By 2001 owned a third of the US data cables
• Was U.S.’ 2nd largest long-distance operator in 1998 and
2002
• Had over 20 million customers in 2002
CEO: BERNIE
EBBERS
CFO: SCOTT
SULLIVAN
Introduction of the case:
• WorldCom, US second largest telecommunication company shocked the world by filing bankruptcy at 21 July2002.
• The WorldCom filing surpassed Enron and became the largest bankruptcy filing in United States history.
• The collapse of WorldCom did not just affect their employees, retailers, the government but also bankers.
• WorldCom was a multi-billion dollar telecommunications company that was founded in 1983.The company starts their business under the name 'Long Distance Discount Services'
(LDDS), providing long distance telecommunication services.
The venture was profitable right from the start.
• In 1985, Bernie Ebbers became the company's CEO. The company changes its name to WorldCom in 1995.
• During the 1990’s, the company starts to grow through series of successful acquisition and merger. However, during the late 1999, the company’s performance begins to slip due to heightened competition, overcapacity and reduced demand for telecommunication services at the onset of the economic recession and the aftermath of the dot-com bubble collapse.
• All these pressures caused WorldCom to involve in
THE WORLDCOM FRAUD:-
Presented By:
Pratik
WorldCom’s Background
• Awoke the sleeping giant by leading the telecom industry into profitability in the 90’s.
• During the 1990’s, WorldCom was deeply involved in acquisitions and completed several “mega-deals”
• Purchased over 60 firms in 2nd half of the 90’s
• WorldCom moved into Internet and data traffic
• Handled 50% of US Internet traffic
• Handled 50% of e-mails worldwide
WorldCom’s Background (cont.)
• Purchased MCI for $37 billion in 1997
• Not allowed to purchase Sprint in 2000 because of antitrust regulation.
• In 1999 revenue growth halted; stock price dropped
• By 2001 owned a third of the US data cables
• Was U.S.’ 2nd largest long-distance operator in 1998 and
2002
• Had over 20 million customers in 2002
CEO: BERNIE
EBBERS
CFO: SCOTT
SULLIVAN
Introduction of the case:
• WorldCom, US second largest telecommunication company shocked the world by filing bankruptcy at 21 July2002.
• The WorldCom filing surpassed Enron and became the largest bankruptcy filing in United States history.
• The collapse of WorldCom did not just affect their employees, retailers, the government but also bankers.
• WorldCom was a multi-billion dollar telecommunications company that was founded in 1983.The company starts their business under the name 'Long Distance Discount Services'
(LDDS), providing long distance telecommunication services.
The venture was profitable right from the start.
• In 1985, Bernie Ebbers became the company's CEO. The company changes its name to WorldCom in 1995.
• During the 1990’s, the company starts to grow through series of successful acquisition and merger. However, during the late 1999, the company’s performance begins to slip due to heightened competition, overcapacity and reduced demand for telecommunication services at the onset of the economic recession and the aftermath of the dot-com bubble collapse.
• All these pressures caused WorldCom to involve in