TULSA, Okla. (AP) _ Williams Communications said Monday it is considering filing for protection under Chapter 11 of the federal bankruptcy code as the huge telecommunications concern tries to reorganize its finances and reduce its large debt load. Its stock price slid more than 60 percent by midday.
The company, which operates a 33,000-mile fiber-optic network that transmits video, voice and data signals, has been trying to develop a restructuring plan to placate a bank group that lent the company $975 million.
``Williams Communications continues to have a productive dialogue with its banks,'' chairman and chief executive Howard Janzen said Monday. ``As previously stated, we believe the company has sufficient cash _ over $1 billion as of Dec. 31, 2001 _ to fund our business plan through 2003. In addition, we are current on all of our obligations.''
But the company said it concluded on Friday that ``certain institutions other than the banks are not likely to participate in the restructuring process on terms that are beneficial to all stakeholders of the company.''
As a result, it said it considering a negotiated Chapter 11 reorganization process so it could continue business without interruption.
But it warned that such a filing could mean ``substantial shareholder dilution.''
In trading Monday on the New York Stock Exchange, Williams Communications slid 57 percent, or 29 cents a share, to close at 22 cents.
Williams Communications also said that whatever course it takes, it plans to cut costs by about 25 percent and said that would include an unspecified number of job cuts.
The entire broadband industry has been hurt by perceptions that it overbuilt. Global Crossing Ltd., one of Williams Communications' chief competitors, filed for bankruptcy protection on Jan. 28.
Williams Communications reported a fourth quarter loss of $372 million, or 76 cents a share, compared with $547 million, or $1.18 a share, for the period a year earlier. The company had revenue of $330 million, compared with $287 million in the year-ago period.
Moody's Investors Service, Standard & Poor's and Fitch Ratings all recently downgraded Williams Communications' debt over concerns about whether the company will meet its financial obligations.