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To: JM who wrote (2574)	6/11/1998 12:28:00 PM
From: Erik H. East	Read Replies (3) \| Respond to of 11568

I said a few months ago that thus deal would proceed slowly. Now the process is even a bigger hairball. Just because Van Miert is satisfied as chief negociator, hope can he convince the 17 or so EU members. DOJ and FCC are lurking in the shadows. MCI has the most to loose, afraid of falling into the laps of laggards GTE or BT who havent done squat. MCI has got to be working evenings and weekends to make it work. IMHO, WCOM is holding the strong cards, but as MCI pieces have to be sold off like pieces of an onion, the true value is shrinking. And, as the clock continues to tick other opportunities are being missed. The talk of a UUNet sale is GTE smoke. In their dreams! UU is essential to WCOM, it stays! MCI internet infrastructure is gone to C&W or others, and maybe some of its internet customer base too. Favorable backbone access rates can be thrown in to the other (extorting) players, so that it is a "win win win."

To: JM who wrote (2574)	6/11/1998 2:16:00 PM
From: Anthony Wong	Respond to of 11568

(Dow Jones) Fahnestock's Wright: C&W Suing MCI To Underscore Agreement June 11, 1998 1:54 PM NEW YORK (Dow Jones)--Cable & Wireless PLC (CWP) is suing MCI Communications Corp. (MCIC) to send a message that "we take our agreement seriously," according to Scott Wright, telecommunications analyst with Fahnestock & Co. "The agreement does have a breakup fee, (and) obviously the parties contemplated that the agreement might not get done and MCI would pay the breakup fee," Wright said in an interview on CNBC Thursday. "As soon as the agreement was announced, there was the likelihood that somebody else would come in and offer a higher price and that MCI would have to think about that," Wright said. Cable & Wireless filed a complaint against MCI to require MCI to comply with its agreement to sell its Internet backbone service business to Cable & Wireless. "Cable & Wireless is trying to protect itself, and MCI is trying to get this merger done," Wright said. As reported May 28, MCI agreed to sell its Internet backbone service business to Cable & Wireless for $625 million in cash in a deal designed to speed regulatory approval of MCI's pending merger with WorldCom Inc. (WCOM) by addressing antitrust issues. "The real issue for the E.U., for U.S. regulators and certainly for companies like GTE that have objected to the merger because of the Internet situation (is whether) the assets that MCI has agreed to sell Cable & Wireless are all of the offending assets, as it were," Wright said. "What GTE is really looking for, and what the regulators appear to be looking for, is that MCI agree to sell a stand-alone, viable business that doesn't have any kind of snap-back to MCI and WorldCom in two years, for instance. Right now they're haggling over just how much more would need to be sold of those MCI assets to win approval," he said. "Right now MCI is obviously in very tight negotiations with the regulators," Wright said. "They're certainly making a lot of conciliatory public remarks (but) the real question is, are they going to get away with selling more of MCI?" "There is a back-and-forth as to whether or not UUNet (Technologies Inc., the Internet Backbone for WorldCom) might be on the block," he continued. "That would clearly satisfy regulators, but I don't think that's going to happen (because UUNet) has really become WorldCom's crown jewel." "Now the question is, is there another buyer for all of MCI's assets or is MCI going to put different assets in two different companies' hands?," Wright said. "I kind of doubt that, it doesn't make a lot of sense to me, but it has raised a lot of questions, particularly with Cable & Wireless." -Victor Ozols; 201-938-5394