Jun 28, 2002 : KPNQwest Network Breakup Likely

📅 June 28, 2002 - Plans to sell the network of European data carrier KPNQwest in one piece were likely foiled by legal and ownership issues this week, as AT&T dropped out of the bidding for the Dutch company's assets.

Buyers became wary Wednesday after KPNQwest's auditors announced they had not approved the firm's 2001 results, and disagreed with statements by former KPNQwest chief executive. The firm's auditor was Arthur Andersen, the auditor involved in the Enron collapse and, more recently, in the WorldCom accounting debacle.
AT&T reportedly had 70 officials investigating KPNQwest's books in the past few weeks. The company pulled out of the bidding due to concerns over ownership issues and reportedly sought warrants to protect it from possible lawsuits.
Among the other concerns is an enormous collection of unpaid bills, including a 100-million-euro debt to French supplier Alcatel.
While it is highly unlikely, now, that the company's network will be sold in one piece, approximately 40 parties are said to be interested in parts of the network.
One of KPNQwest's founders, KPN, is also said to be in preliminary talks with the company's trustees about acquiring a substantial portion of the network.
KPN is involved with a group of telecoms firms working to keep the KPNQwest network running for the sake of some customers who have not yet switched to other providers.