Qwest Not Out of the MCI Race Yet
Qwest Communications caught a break from MCI over the weekend as its board declared Qwest’s offer superior to Verizon’s.
MCI’s current deal with Verizon is at $7.8 billion with Qwest’s latest bid at $9.9 billion.
A ComputerWorld article says, “Although MCI’s board has decided that the Qwest offer is superior, it hasn’t yet changed its recommendation to shareholders to accept the Verizon deal. Under the terms of the merger previously agreed on, Verizon has until Friday to submit a revised offer or let its current offer stand. MCI’s board then has until May 3 to change or keep its current recommendation.”
Qwest has been rejected three times, though Verizon’s offers have been lower. MCI maintained that Verizon offered the company better financial stability and growth opportunities.
MCI would suffer a $240 million penalty if it backs out to go with Qwest. Verizon has been given until April 29 to come up with a better offer or stay with the one it has already made. MCI’s board will then have until May 3 to change or keep its recommendation.
Qwest has said that this was the company’s final offer. We’ll see what card Verizon plays next.