New suitor for Global Crossing

Global Crossing's network is up for grabs

Telecoms firm XO Communications has offered $700m (£423m) to acquire Global Crossing, which went bankrupt in January 2002 in one of the biggest-ever US corporate failures.

The intervention of XO, a firm controlled by billionaire Carl Icahn, throws the future of Global Crossing into further confusion.

Singapore Technologies Telemedia already has an agreement to pay $250m for a 61.5% stake in the firm.

And IDT has said it will bid for Global Crossing, but new bids cannot be considered until the deal with Singapore Technologies is formally approved or rejected by the bankruptcy court.

Deal-breaker

XO said its offer is more generous by $100m than any other, through a combination of cash, shares and other financial instruments.

But XO will have to wait for any decision until the Singapore deal is finalised.

Singapore Technologies became the sole bidder after Hutchison Whampoa walked away from the deal last month amid concerns over its ties to mainland China.

The SIngapore deal could be similarly torpedoed, some analysts have speculated, since the firm has close links with the Singapore Government.

Bust

In January last year, Global Crossing filed for what was then the fourth-largest bankruptcy on record.

The company collapsed under the weight of $12.4bn of debt, falling prices and a glut of high-speed capacity network which it could not sell.

Global Crossing faces investigations into its accounting practices, and lawsuits from shareholders.

Nonetheless, it plans to emerge from bankruptcy "in the coming months".