In a move certain to irritate Verizon executives and
titilate MCI has raised its bid
for MCI by $800 million to $9.7 billion.
The cash and stock offer, which breaks down to $30 per share, is the latest
in a battle between Qwest and Verizon for the Ashburn, Va., long-distance
and network services provider.
“This revised offer provides an additional $2.50 per MCI share in value, an
additional $1 billion in committed financing for the combined company,”
Qwest CEO Richard Notebaert said in a letter to MCI directors. “We are
confident that this offer constitutes a superior proposal within the
meaning of your amended merger agreement with Verizon.”
MCI, which has demonstrated its preference for a Verizon merger, said in a
statement that it will review the revised offer. Notebaert said the offer
will be withdrawn if MCI doesn’t agree that it is superior to Verizon’s $7.6
billion bid by 5 p.m. EST tomorrow.
Verizon also weighed in.
“We continue to believe Verizon is the best partner for MCI,” the New York
regional carrier said. “As we move through the proxy process, we will
continue to assess the situation and intend to take the necessary steps at
the appropriate time to secure shareholder approval and complete our pending
transaction.”
Qwest and Verizon covet MCI because of its large IP data-service deals with
government agencies and corporations. And with the pending merger of SBC
and AT&T
, neither wants to be left behind by
the wave of industry consolidation.
The Baby Bells consider those long-term, high-margin contracts crucial to
their future prosperity, as cable operators, VoIP upstarts and wireless
carriers try to hone in on their traditional businesses.
