Cable & Wireless in Talks to Buy MCI's Internet Business
Bloomberg News
June 23, 1998, 11:09 a.m. ET
Cable & Wireless in Talks to Buy MCI's Internet Business
New York, June 23 (Bloomberg) -- Cable & Wireless Plc Chief
Executive Richard Brown said the second-biggest U.K.-based phone
company is in talks to buy the Internet assets MCI Communications
Corp. must shed to get regulatory approval to sell the company
to WorldCom Inc.
''Cable & Wireless is in discussions with MCI right now
about whatever it is they may need to sell to satisfy
regulators,'' Brown said. ''We remain highly interested and we
are pursuing with MCI in great earnestness discussions about the
possible acquisition of this asset base.''
Yesterday, the European Union agreed to approve WorldCom's
proposed $44.0 billion purchase of MCI, the No. 2 U.S. long-
distance company, after MCI said it will sell its Internet
business.
Cable & Wireless agreed last month to buy MCI's wholesale
Internet operations, which carries traffic for other Internet
service providers, for $625 million in cash.
When that failed to stem regulatory opposition, MCI offered
to sell all of its Internet businesses and said it will
shed its consumer and business customers.
The European Commission, the EU's executive agency, will
hand down its formal approval on July 8 with U.S. regulators
expected to give their blessing soon after. MCI is likely to wait
until it gets the regulatory green light before unveiling a buyer
for the Internet operations.
MCI and WorldCom, the No. 4 U.S. long-distance company,
expect to complete the purchase this summer. That would create
the second-largest U.S. phone company behind AT&T Corp.
MCI WorldCom will control about a quarter of the
$70 billion-a-year U.S. long-distance market and offer local
services in more than 100 cities.
Cable & Wireless rose 11 pence to 661 pence. Jackson
Mississippi-based WorldCom rose 7/16 to 48. Washington-based MCI
rose 9/16 to 57 1/2.
--Colleen McElroy in New York with Alison Jahncke in the Brussels |
