MCI’s board on Tuesday accepted Verizon’s sweetened $7.6 billion offer, rejecting Qwest Communications’s larger ($8.45B) bid.
E-Week, Om Malik and Google News have the latest.
MCI said Verizon raised its cash-and-stock offer to $23.50 a share, including $8.75 per MCI share in cash and $14.75 per MCI share in Verizon stock.Qwest said it would “assess the situation,” but that it still believed its $8.45 billion bid was superior. Many MCI shareholders have urged Qwest to pursue MCI, saying Verizon’s original $6.75 billion offer was too low. Verizon said its revised bid was a “compelling” offer for MCI shareholders.
Qwest had given MCI until April 5 to accept or reject its bid, after weeks of talks in which Qwest increased the amount of available financing for its bid to $5.75 billion.
Qwest Chief Financial Officer Oren Shaffer said in a presentation to investors on Tuesday before MCI’s reply that MCI had made several demands during the negotiations, and the talks had come close to being “disingenuous.”
Both companies see MCI as a foothold into the market for selling voice and data services to large businesses. Qwest is the fourth-largest U.S. local telephone company.
Verizon, the largest U.S. telecommunications company, has said its deal offers more stability to MCI shareholders. It has criticized Qwest’s estimates of financial benefits from an MCI deal, including $14.8 billion in cost savings, as “modern fiction.”
What now for Qwest? How about Level 3, XO, WilTel or Time/Warner Telcom - with a satellite/WiMax play? What they could use is some towers — so how about a partnership with T-Mobile or Sprint? Level 3 or Global Crossing sold its small business group to Matrix Telecom. The company is now up against Infonet, now part of BT; Equant, now wholly owned by France Telecom as well as AT&T/SBC and MCI/Verizon.
Just some helpful advise.
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