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May 22, 2002 — (WEB HOST INDUSTRY REVIEW) — Global telecommunications firm WorldCom (WorldCom.com) said late yesterday it would eliminate its WorldCom group and MCI group tracking stock structure effective July 12.
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By doing so, the company said it expects to save $284 million annually due to the elimination of the MCI group dividend.
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The tracking stocks were introduced last June. WorldCom issued stock for the company’s MCI Group under the ticker symbol MCIT, which now tracks its phone, paging services and dial-up Internet services. The company’s core Internet, Web hosting and corporate telephone services are tracked under the ticker symbol MCIT. Share prices for each have dropped significantly since the introduction of the tracking stock structure.
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“We said from the outset of our new management team that we would take the bold steps necessary to build on our strong balance sheet and strengthen operational efficiencies that will better position the Company for future growth,” said John Sidgmore, WorldCom’s President and CEO. “This is one of those steps.”
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Share prices for both stocks were up in trading Wednesday morning.
