WorldCom to Write Down $79.8 Billion of Good Will

NEW YORK – WorldCom said Thursday that it was writing down $79.8 billion of its good will and other assets, The New York Times reported.

The company said in a statement that all existing good will, valued at $45 billion, would be written down. WorldCom also said it would reduce the value of $44.8 billion of equipment and other intangible assets to about $10 billion.

WorldCom had previously signaled that it was considering the write-downs, but the immensity of the values involved surprised some analysts. WorldCom's write-downs are second only to those of AOL Time Warner, which recently wrote down nearly $100 billion of assets.

"This raises the specter of other write-downs by competing companies like AT&T and Sprint," said Patrick Comack, an analyst at Guzman & Company in Miami. "It's basically another example of the telecom mirage, with network assets in reality worth a fraction of their past value."

-- NYSSCPA.org News Staff

Posted on 03/14/03