Service provider McLeodUSA Inc. said yesterday its CEO has resigned, but will remain on the board of directors.
The CLEC Chris Davis resigned as of Aug. 12 amidst the companys restructuring efforts, but she will stay on as chairwoman of the board.
Ken Burckhardt also stepped down last Friday from his positions as executive vice president, CFO and a company director.
Joe Ceryanec, controller and treasurer, is serving as acting CFO. Meanwhile, McLeodUSA has appointed Stan Springel of Alvarez & Marsal as chief restructuring officer. Alvarez & Marsal is a firm that provides management and consulting services for companies that are restructuring.
The provider, which serves markets in 25 states, says its stockholders will not be repaid under the restructuring plan. According to McLeodUSA, its lenders have agreed not to take action from nonpayment of certain amortization and interest payments due by Sept. 9.
The company announced earlier this year it was looking into restructuring options. McLeodUSA emerged from Chapter 11 bankruptcy protection in April 2002.
Companies like McLeodUSA are struggling as the big companies are offering VoIP services as well as their traditional telephone services, says telecom industry analyst Jeff Kagan, adding the companys restructuring does not mean McLeodUSA is going out of business, but it does mean in their current position, their growth is limited as the marketplace moves beyond simple voice and internet services. They will be able to stay in business, and they could still be successful, but telecom in general is growing beyond what McLeodUSA can deliver to the masses.