Purchase Of Brazil's Embratel Fits Growth Strategy - MCI
Dow Jones Newswires -- July 29, 1998
NEW YORK (Dow Jones)--MCI Communications Corp. (MCIC) said its purchase of Embratel, the Brazilian long-distance telephone company, complements the telecommunication giant's global growth plans.
As reported, MCI emerged as the winning bidder for Empresa Brasileira de Telecomunicacoes, known as Embratel (E.EMB), one of 12 telecommunications units auctioned off by Brazil's government as part of the privatization of the country's telecommunications holding Telecomunicacoes Brasileiras, known as Telebras (TBR).
MCI paid $2.26 billion for Embratel.
In a press release, MCI said its offer was within MCI's valuation of the company.
MCI is expected to pay 40% of the bid price within the next five days, with the balance due in two annual installments.
"Embratel is an ideal fit for MCI's and WorldCom's (WCOM) international growth strategy and extends the companies' local-to-global approach," MCI's statement said.
"Embratel's wholly-owned nationwide and international network meshes well with MCI's and WorldCom's global initiatives and complements the companies' plans with Telefonica (TEF)," the statement added.
Michael Rowny, executive vice president and acting chief financial officer, noted that with full deregulation occurring in 2002, Embratel's "addressable market will grow to more than $30 billion, making it one of the most attractive opportunities in the world." |
