Luck’s no longer a lady for WorldCom’s ex-CEO Bernie

The Canadian native and Mississippi transplant, who typically opened big corporate meetings with a prayer, stood as a stark cultural contrast to the Washington lawyers and Wall Street bankers who backed his years of deal making. Even after the purchase of MCI propelled him onto the global stage of major telecom leaders, Ebbers kept WorldCom’s corporate headquarters in Clinton, near Jackson, the folksy capital of Mississppi, where every resident had a Bernie story to tell. For his own part, the WorldCom boss kept his fondness for jeans and cowboy boots. He often complained when forced to wear a business suit, but had difficulty keeping the momentum going as his old game of marketing long- distance became a commodity. As one of the founders of WorldCom predecessor LDDS, Ebbers engineered a slew of deals that have brought him some of what were once the best-known names in the telecommunications business, including MCI, SkyTel, WilTel and MFS.

The 6-foot, four-inch Ebbers attended Mississippi College on a basketball scholarship, graduating in 1967 with a degree in physical education. After pursuing a few different jobs, he bought a Mississippi motel that served as the foundation of one of his first little empires. Eventually, he owned about nine Best Western motels. Ebbers broke into the telecommunications business in the early 1980s when he and some friends sketched out plans on a dinner napkin in which they would buy long-distance service from major phone companies and re-sell it to small businesses. LDDS was born soon after and went public in 1989 with Ebbers serving in the role of chief executive. The company later changed its name to WorldCom in 1995.

Already known in industry circles for a handful of big acquisitions, Ebbers burst into the headlines in 1996 with a then-whopping $37 billion stock bid for MCI, which had already agreed to merge with British Telecommunications Plc, he won MCI after a bruising takeover battle with rival bidders. But the late 1990s witnessed a rapid shift in the US telecommunications industry from a voice-based business to a new focus on Internet-based data traffic. Ebbers found it difficult to dance the two-step out of what was thought to be an increasingly global telecom business built on new Internet business models and the plunging cost of fibre-optics network capacity. He also frequently locked horns with regulators both in Europe and the United States.

WorldCom’s failure to find a partner in the fast-growing wireless business was compounded more recently by a dramatic, global downturn in the telecommunications market that undercut the company’s growth across its various businesses.

The man whose $1.4 billion fortune ranked him as one of the world’s richest men bowed out in the face of a plummeting stock price, a mountain of debt and investigations into $366 million in personal loans he received from his struggling company. Ebbers—who relinquished his posts as president, chief executive, and board member on Monday under mounting pressure—was succeeded by vice-chairman John Sidgmore.

(Reuters)