Verizonwent on the offensive Wednesday, criticizing rival Qwest’sbid for MCI.
Verizon CEO Ivan Seidenberg criticized Qwest’s finances and called into question Qwest’s financial projections for a merger with MCI.
“Explaining in the future the failure to have delivered on exaggerated promises of synergies is understandably preferable to the stark reality of its current stand-alone financial prospects,” Seidenberg wrote.
The broadside occurred a day before the deadline Verizon gave MCI for exploring a deal with Qwest. Qwest reportedly is considering raising its bid from $8 billion to $8.5 billion, indicating resistance from MCI.
But with Qwest’s offer 26% higher than its own $6.75 billion offer, Verizon will likely face pressure to raise its offer, or MCI could face a revolt by shareholders. Verizon’s $20.75 a share offer would have to increase considerably just to reach MCI’s current $23.75 share price, let alone Qwest’s expected $26 a share offer.
MCI’s board may prefer a future with Verizon, but their shareholders clearly want more than Verizon is offering.
Stay tuned. The fun may just be getting started.
The broader market tumbled Wednesday on a warning from GMand another new high in oil prices.
The Nasdaq fell 19 to 2015, the S&P 500 lost 9 to 1188, and the Dow tumbled 112 to 10,633. Volume rose to 1.65 billion shares on the NYSE, and 1.99 billion on the Nasdaq. Decliners led 24-9 on the NYSE, and 20-11 on the Nasdaq. Downside volume was 74% on the NYSE, and 79% on the Nasdaq. New highs-new lows were 49-64 on the NYSE, and 38-91 on the Nasdaq.
Research in Motionrocketed 17% after the company settled its patent dispute with NTP.
Akamaiclimbed 6% on an acquisition.
Microstrategyplunged 14% after the company’s auditor resigned.
Convansysjumped 13% on its results.
Shopping.comand Sonicsurged on upgrades.
Opnetsoared 23% on a distribution deal with Cisco.