Platinum May Bid for Global Crossing
Los Angeles-based Platinum Equity is considering making an offer for troubled Global Crossing Ltd., a move that could set up a bidding battle between two brothers and their turnaround firms.
Platinum Equity, run by Tom Gores, acknowledged Wednesday that it has begun reviewing Global Crossing’s financials and could submit an offer before a Bankruptcy Court hearing in New York next week.
In January, Platinum was negotiating to buy Global Marine, Global Crossing’s fiber-laying and maintenance subsidiary. That deal didn’t materialize before Global Crossing filed Jan. 28 for Bankruptcy Court protection.
Platinum now is weighing the merits of the entire company. The privately owned buyout firm signed an expanded confidentiality agreement Monday to get a closer look at Global Crossing’s operations.
“It’s 99% sure we’ll submit a bid,” said Gores, founder and chief executive of Platinum. “We will make a bid for the entire company.”
Gores said the Platinum bid probably will include more than $750 million in cash, though he declined to elaborate.
On Saturday, sources said Los Angeles-based Gores Technology Group, headed by Tom Gores’ older brother, Alec, is readying a bid for Global Crossing.
Neither company has disclosed terms of the planned offers, but the two have unwittingly bid against each other before.
In late 2000, both turnaround firms made offers for Learning Co., Mattel Inc.’s troubled software company.
Alec Gores won the company, and claimed to make it profitable 75 days later.
If both firms follow through with planned bids, it would bring to four the number of known offers for Bermuda-based Global Crossing, which has executive offices in Beverly Hills.
Global Crossing has proposed a deal with two Asian firms, Hutchison Whampoa and Singapore Technologies, which have offered $750 million in cash for about 79% ownership in a restructured Global Crossing.
Creditors have panned the offer as insufficient.
A separate bid by shareholders has been neither embraced nor rejected by creditors.
Platinum, founded in 1995, has purchased 36 technology firms and subsequently sold six of them. The company’s most recent acquisition came in January, when it bought a piece of Alcatel’s business services operation for about $1.3 billion. The group bought by Platinum has 6,500 employees and serves 400,000 business customers in 17 European countries.
Tom Gores, 37, made his debut on the Forbes 400 list of richest Americans this year, with his estimated $1.5-billion net worth ranking him No. 293.
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Associated Press was used in compiling this report.
