Does anyone know what this is about and what impact it might have on WCOM/MCIC?
Saturday March 7, 6:05 am Eastern Time
Telefonica seen signing MCI-WorldCom pact-paper
MADRID, March 7 (Reuters) - A Spanish newspaper on Saturday said Spanish telecommunications giant Telefoncia
(TEF.MC) was about to sign a strategic pact with U.S. operators MCI(MCIC - news) and WorldCom(WCOM - news),
citing Wall Street bourse sources.
Economic daily Gaceta de Negocios said a deal would be signed on Monday in Washington DC by Telefonica president Juan
Villalonga, but gave no details on the nature of the pact the companies would seal.
Telefonica was unavailable for comment.
The Spanish market widely expects Telefonica to team up with MCI and WorldCom to gain a firmer grip on North and South
American markets in the wake of the Spanish carrier's break with international ally British Telecom (quote from Yahoo! UK &
Ireland: BT.L) last month.
But none of the parties involved has yet made any offical comment.
Despite a sharp rise in Telefonica's 1997 earnings, the company's shares fell sharply on the news of its break with BT, with
analysts citing direct competition from the British carrier in the Spanish market, until now Telefonica's uncontested domain, and
uncertainty on the international front.
But the implications for Telfonica's international alliances, suddenly left up in the air following the rupture, were far more
worrying, analysts say. Telefonica must forge new international partnerships to help it to expand in key Latin American markets
like Brazil.
Telefonica announced on Tuesday it would seek approval for a rights issue to raise around 640 billion pesetas ($4.2 billion)
which the company has said it would plough in to Brazil's telecommunication sector when it is liberalised. |
