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Spokane, Washington  Est. May 19, 1883
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News >  Business

Qwest raises offer to acquire MCI

Associated Press

DENVER — In the biggest telecom takeover battle since it won U S West in 1999, Qwest Communications International Inc. boosted its bid to acquire MCI Inc. on Thursday, hopeful $8.45 billion will be enough to break up the long-distance carrier’s plan to merge with Verizon Communications Inc.

The nearly half-billion dollar increase — making Qwest’s offer $1.8 billion higher than the current value of MCI’s deal with Verizon — was sure to intensify pressure on MCI’s board to either switch merger partners or squeeze more money from Verizon.

MCI, still apparently desirable despite its damage from the WorldCom scandal, said its board will respond to Qwest’s new offer by the close of business on March 28.

Verizon responded by repeating its contention that both Qwest and its offer were financially dubious. The company declined to say whether it might consider renegotiating the price.

Many observers expect Verizon to pay more now, but that it might not need to match Qwest’s offer since it is still MCI’s first choice.

Qwest’s proposal reiterated projections that it could produce twice as much in cost savings as Verizon. Qwest also said MCI’s lawyers have apparently agreed a Qwest deal would gain government approval quicker than a Verizon merger because of competitive concerns.

If MCI decides a rival bid is superior, Verizon has five days to make a counteroffer.

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