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Scott: assessing the best way of delivering value
01 May 1999
IXC Communications is building a coast-to-coast fibre-optic network in the US. Following the announcement of the Frontier-Global Crossing deal in March 1999, the operator has been mentioned as a possible acquisition target by either a domestic or foreign telco. Chairman, CEO and president Ben Scott talks to Global Telecoms Business about the operator's plans.
IXC Communications creates network-based delivery solutions to meet
the requirements of the global communications market. It is
expanding its network from 9,300 miles today to over 16,000 by the
end of 1999.
A wholesale provider, IXC Communications is also targeting small
and medium-sized businesses in retail and is increasing revenues
internationally, in particular from its joint ventures, Storm, in
Europe and Marcatel in Mexico.
In 1998 IXC Communications more than tripled operating cash flow
to $90.7 million, up from $23 million in 1997. However, despite
this success, the company is still under-valued, compared to its
peers. Doubts have been raised about its ability to maintain
growth, as the switched wholesale long-distance business, one of
the principal revenue generators for IXC Communications, becomes
increasingly competitive and pricing/unit margins decline. A recent
decision to employ the services of Morgan Stanley Dean Witter to
investigate different ways of enhancing the company's value has
been interpreted as a sign that...
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