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WorldCom Renaming Itself MCI

Mike Capellas' revamping push is set to take another turn Monday.

You can say good-bye to

WorldCom

next week. Or at least to that particular name.

The troubled telco will rename itself

MCI

on Monday, according to a source familiar with the company's plans. The changeover will involve new signage, new letterhead and even name-changing commemorative events worldwide, says the source.

The move,

which outsiders have speculated for months was part of the company's agenda, is arguably a sensible strategy, given how accounting scandals have tainted the reputation of WorldCom, which is operating under bankruptcy protection.

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Telecom industry insiders were to be briefed on the company's turnaround efforts Thursday.

But WorldCom, which has shed 22,000 employees in its effort to stay afloat, is bound to irk current and former workers preferring the company's cash to be spent on salaries rather than on new business cards.

A WorldCom spokeswoman declined to comment.

WorldCom, which acquired MCI in 1998, continues to use the MCI brand name for residential telephone service in the United States. The WorldCom corporate name once symbolized the steady ascendance of CEO Bernie Ebbers, who built the company from a small long-distance telco. But Ebbers' and WorldCom's reputation was tarnished last year by news of Ebbers' extensive borrowing from WorldCom and allegations that the company's earnings before interest, taxes, depreciation and amortization had been overstated by billions of dollars.

Ebbers was ousted from WorldCom last year; leading it now is former Compaq CEO Michael Capellas.

The rebranding is justifiable, says one former WorldCom executive -- but not so with the timing. The executive says that despite a court order, WorldCom has failed to pay the complete severance it owes to thousands of former employees. "It's just one excuse after another," says the executive, who spoke on condition of anonymity.

"It's just odd to me that they can lay down this kind of money and do this event when they haven't settled the fraud charges yet, they don't know what the final

size of the alleged fraud is yet, they haven't emerged from bankruptcy, and they haven't complied with the judge's court order from six months ago to settle the debts with the former employees," says the former executive.

"I support that they need to do it," says the executive, "but I think the timing is unprofessional at best."