Gores Technology Group, a firm which specialises in taking over the assets of high-profile failed companies and turning them around, is planning to bid for Global Crossing, Reuters and the Wall Street Journal newspaper have reported.

Both reports cite sources close to Gores as saying the group is ready to outbid the offer from Hong Kong telecoms-to-property conglomerate Hutchison Whampoa and Singapore Technologies Telemedia, by a significant margin.

Both the existing bidders already own stakes in Global Crossing, which filed for bankruptcy and protection from its creditors on 28 January with liabilities totalling $12bn and assets worth $22.4bn.

On the table

Hutchison has since said that the $750m bid in which it is involved will not be raised, regardless of whether another suitor comes forward.

For the $750m, it and Singapore Technologies Telemedia would get 79% of the company.

Existing shareholders would lose everything, while creditors would get the remaining 21% along with $300m in cash and a new $800m debt line.

Given the scale of the company's assets, some observers have commented that the offer effectively hands the company to two of its shareholders for a knock-down price.

One major creditor, Fleet National Bank, has already gone to court to stop the offer, saying it is "tainted by collusion and self-dealing".

The only other alternative currently available is from a group of existing shareholders, who promise to raise $5.5bn over three years to repay creditors.

Overconfidence

Global Crossing was one of a rash of "carriers' carriers" - new telecoms companies building fibre-optic capacity around the world with the aim of selling usage rights on.