Flag Telecom files for bankruptcy
Bermuda based Flag Telecom has filed for bankruptcy protection following rapidly falling sales and mounting debts.
Troubled telecommunications company Flag Telecom has filed for bankruptcy protection in the face of rapidly falling sales.
The Bermuda based company specialises in selling network capacity to large international carriers but has been affected by a rapid downturn in the wholesale market.
Flag operates a global undersea fibre optic cable network, selling its capacity to traditional carriers and Internet service providers.
Carriers have been hit by massive overcapacity and a rapid decline in telecoms expenditure. Flag has run up heavy debts as a result.
Flag warned in February that it might be able to carry on into 2003 as the company unveiled an annual loss of US$224m for 2001.
The company has begun restructuring negotiations with creditors and hopes to have reached an agreement by early June.