Word: telecoms
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Dates: during 1990-1999
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Just last month he agreed to pay $1.2 billion for the CompuServe online service, keeping CompuServe's Internet hookups and swapping its consumer subscribers for the hookups of America Online. That gave WorldCom, which has made some 50 acquisitions in little more than a decade, a broader range of telecom assets--from local and long-distance lines to high-speed Internet-access networks--than even mighty AT&T. Adding MCI would balloon WorldCom's revenues from $4.5 billion in 1996 to nearly $28 billion and make the company, based in Jackson, Miss., by far the leading challenger...
...Ebbers has traveled a circuitous route to become the telecom industry's Southern-fried Paul Bunyan. After graduating from high school in Edmonton, Alta., Ebbers started out as a milkman but soon found that "delivering milk day to day in 30-below-zero weather isn't a real interesting thing to do with the rest of your life." A warmer clime beckoned in the form of Mississippi College, a Southern Baptist school in Clinton, Miss., where the Canadian won, of all things, a basketball scholarship and mostly rode the bench before graduating in 1967 with a bachelor's degree...
...cutting overhead and paying for the acquisitions with his company's stock. His plan worked so well that anyone who invested $100 in WorldCom stock when the company went public in 1989 would today have a holding worth more than $3,000--by far the best showing in the telecom industry and one of the biggest advances for any U.S. company. His 1.8% stake in WorldCom is worth some $600 million...
...deal not only altered WorldCom's destiny but also brought a new superstar to its managerial ranks in Sidgmore, the technovisionary behind UUNet. He joined Ebbers and chief financial officer Scott Sullivan in a troika that has fashioned WorldCom into the very model of a 21st century telecom empire. Ebbers "sees the industry at a historic turning point," Sidgmore says. "That's why WorldCom is moving so quickly. "We've made big bets and moved faster than anybody else." Indeed, even as Ebbers was bidding for MCI last week, WorldCom was unveiling a $2.9 billion buyout of Brooks Fiber Properties...
...will they follow? No other big entertainment company has a direct-purchase program. But in this era of increasing shareholder power, whenever an industry bellwether makes the move, others tend to fall into line. US West was the first among telecom companies, in 1994; eight others have direct purchase now. Texaco got the ball rolling in oil five years earlier; now you can own Chevron and Mobil that way. Disney's move to reinstate direct purchase most likely will have influence outside its industry as well. CEOs of all stripes will probably conclude that it must have good reason--beyond...