MCI is in preliminary talks with Nextel - sources
NEW YORK, April 6 (Reuters) - MCI WorldCom Inc. (Nasdaq:WCOM - news), the No. 2 U.S. long distance company, is in preliminary talks to buy wireless phone company Nextel Communications Inc. (Nasdaq:NXTL - news), people familiar with the situation said on Tuesday.
The discussions are ''very preliminary'' and the possibility of reaching an agreement is no more than 50 percent, said one source who declined to be named.
MCI WorldCom and Nextel declined to comment.
An agreement could be prevented by several factors, including price, Nextel's substantial debt load and MCI WorldCom Chief Executive Bernie Ebbers' aversion to acquisitions that dampen the company's earnings, sources said.
Nextel, the last independent national wireless phone company, has been seen as a ripe takeover target for more than a year. That speculation intensified in January when rival AirTouch Communications Inc. (NYSE:ATI - news) received acquisition offers from two suitors and agreed to be acquired by Britain's Vodafone Group Plc (quote from Yahoo! UK & Ireland: VOD.L).
Shares of Nextel have gained nearly 68 percent since the beginning of the year. Nextel's shares traded at $41.375, up $1.75, in pre-market trading on Tuesday, while shares of MCI WorldCom fell $1 to $91.50 in pre-market trading, traders said.
|
