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BellSouth mulling acquiring Qwest - WSJ
Reuters Story - June 09, 1999 05:56
NEW YORK, June 9 (Reuters) - BellSouth Corp is considering acquiring Qwest Communications International Inc after its recent purchase of a 10 percent stake in the long-distance carrier, the Wall Street Journal reported Wednesday.
In a Securities and Exchange Commission filing, BellSouth suggested that it has considered purchasing Qwest and that Qwest's management could support the decision, the Journal reported.
BellSouth has so far focused on bolstering its local business in nine states and boosting its ties in Latin America, rather than making acquisitions or alliances. This strategy has led some to question how BellSouth will continue to grow rapidly, the newspaper said.
BellSouth, like rival regional Bell telephone companies, is precluded from owning more than 10 percent of any long-distance carrier.
But all Bell companies are seeking approval to enter the long-distance arena, and some believe that permission in at least one state will be granted by the end of this year, the newspaper said.
However, it is unknown whether BellSouth will buy Qwest, whose market value is about $30 billion, the newspaper said. BellSouth's market capitalisation is $87 billion, it said.
Both companies declined to comment, it said.
In addition to its 10 percent stake, bought for $3.5 billion, BellSouth secured an option to purchase an additional 10-percent stake in Qwest if BellSouth gains permission to offer long-distance services in all of its states, the newspaper said.
BellSouth serves nine states in the Southeast
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