Global's Winnick Steps Down

Once named the richest man in Los Angeles, Winnick was alternately hailed as a big charitable donor to zoo and library projects and reviled as a corporate scoundrel who cashed out at least $575 million in Global Crossing stock before the company collapsed into bankruptcy proceedings.

Winnick's resignation was expected as part of the company's reorganization plan, which was approved this month and pays creditors pennies on the dollar for the billions in debt Global Crossing used to build a worldwide fiber-optic network.

"In order for the company to have a shot at recovering, you have to bring in new leadership," said Jeffrey Kagan, a telecommunications consultant in Marietta, Ga. "You have to wash away everyone that's been tainted by the process and start clean."

Although Chief Executive John Legere will stay at the company, Winnick's co-chairman, Lodwrick Cook, is expected to be ousted when two Asian companies take over next year as majority shareholders. The company's reorganization must still be reviewed by the Federal Communications Commission. Cook declined to comment.

Winnick, who will formally step down today, will return to his Beverly Hills investment banking firm, Pacific Capital Group.

"The collapse of the telecommunications industry

Winnick, a former colleague of disgraced bond trader Michael Milken at Drexel Burnham Lambert, had no telecommunications experience when he raised $20 billion to launch Global Crossing in 1996.

Global Crossing declined to comment beyond a short statement from Legere.

"We want to extend our thanks to Gary Winnick," he said. "His courage and dedication to a singular vision led to the completion of an advanced global IP [Internet Protocol] network that only five years ago existed as a concept on paper."

But Andrew Odlyzko, director of the Digital Technology Center at the University of Minnesota, had a different take on Winnick's tenure at Global Crossing. He predicted that it would be viewed historically as a lesson in greed.

"Anybody who looked intelligently at this business would have seen that this was a bubble, something that was bound to come to a bad end," he said. "People years from now will not laud him as a builder or visionary."