Hi;
So maybe GTE itself will be on the block!!!!
-----------------------
Thursday November 7 2:50 PM EST
TALKING POINT/ GTE Corp seen able to go it alone
By Brendan Intindola
NEW YORK, Nov 6 (Reuter) - While MCI Communications Corp last week acknowledged it was in takeover talks with British Telecom BT.L , Wall Street rumors were rampant on Thursday it had been talking to the low-key GTE Corp first.
GTE has declined to discuss what, if any, MCI talks occurred but analysts agreed that the local telephone company with a growing long-distance business is not necessarily the victim of lost opportunity.
"GTE's position is as it was (before the MCI-BT announcement) because it is only one of eight local carriers in the long-distance market," said Bill Detherage of Bear Stearns, who also pointed out the strength of GTE's fast-growing U.S. cellular telephone service.
He noted that GTE would be an "attractive partner" in a merger, though "they are in good shape on a stand-alone basis and not under any pressure" to effect a deal.
"MCI approached GTE, so as opposed to GTE looking for an acquisition they had one presented to them, so I don't think they are looking," Detherage added.
But some analysts believe the ability to compete in the increasingly global telecommunications industry will be a function of sheer heft, a factor that will eventually force GTE to the table.
"The message in the BT-MCI deal is that nobody is too big. GTE either will grow their alliances or enhance them by being a buyer, particularly in the long-distance business," said Scott Wright of Argus Research.
"Expanding alliances is an interim move, not a long-term solution. It is better to own a facility. It is one thing to do it with a string, it is another to lasso it," he said.
"I like the idea of GTE possibly hooking up with WorldComm. But traders seem to think GTE is a seller, with the stock up recently," Wright said, referring to recent market speculation about a combination with WorldCom.
Barry Sine of SBC Warberg, said, "GTE brings a lot to the table, either in a link-up with Concert (the BT-MCI merged company) or even AT&T, and both have been mentioned."
"GTE has extensive holding in Latin America and they are among the more aggressive bidders to get cellular licenses in Brazil, while Concert has areas of weakness there," Sine said.
"If BT-MCI decided at some point to up the ante and acquire another U.S. company, there is no reason MCI-BT would not do a deal with GTE," Detherage said.
"This would shift the balance of revenues to predominantly U.S. rather than U.K. From BT's standpoint, that would risk becoming a reverse takeover at this point where U.S. people would run the company," he said.
---------------------- |
