At the same time, the company said it was proceeding with its merger with Global Crossing.

By that time, though, Salomon had already benefited from a fruitful investment banking relationship with Global Crossing.

Concern over the bankruptcy proceedings appears to be spreading to firms that do business with Global Crossing.

The earnings shortfall is not expected to affect the merger agreement with Global Crossing.

"This is not something that would have disqualified us from working with Global Crossing."

Reliant officials acknowledge the company completed a deal with Global Crossing but declined to discuss the details.

"We pitched to them that we could manufacture earnings," the executive said, referring to the deal with Global Crossing.

A spokesman for Flag declined to say whether his company had any dealings with Global Crossing.

With Global Crossing almost certainly not moving into the space, the overhaul has become an obstacle to finding new tenants.

Those values are close to the deals struck with Global Crossing, giving investors little reason to prefer one company over the other.