About That $366 Million I Owe You...

It's an IOU that has staggered the corporate world. Bernard J. Ebbers, the CEO of WorldCom Inc. (WCOM ) and onetime billionaire, owes his company $366 million because it bailed him out of personal loans that came due when WorldCom's stock tanked.

Now the question is whether Ebbers can repay WorldCom. He says he won't sell his 17 million WorldCom shares, which are currently worth $59 million. Rather, Ebbers plans to sell off other investments, which WorldCom says are sufficient to cover his debt. The company won't identify those holdings, but BusinessWeek tracked down more than $550 million of Ebbers' investments.

Much of it is in real estate. His personal investment company bought 460,000 acres of timberland in the Southeast U.S. in 1999 from Kimberly-Clark Corp. for about $400 million. That property has likely lost value since timber real estate prices have slipped 10% since his purchase, say industry analysts. He also bought British Columbia's 164,000-acre Douglas Lake Ranch in 1998 for about $60 million, according to brokers who worked on the deal. That property has held its value.

A trucking investment, however, may have soured. Ebbers helped fund the takeover of KLLM Transport Services Inc. in 2000 with about $27 million. The refrigerated trucking industry has since been pummeled, says analyst John G. Larkin of Legg Mason.

Other holdings have done better. He owns thousands of acres of farmland in the Southeast that have climbed steadily in value. "That land is typically going at $1,000 or $1,200 per acre," says Wesley Kent, who sold Ebbers several pieces of Mississippi farmland at $500 to $600 per acre. Still, it will take quite a fire sale to cover his $366 million debt owed to WorldCom.

By Ben Elgin in San Mateo, Calif.

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