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To: Anthony Wong who wrote (2592)	6/12/1998 3:15:00 PM
From: Anthony Wong	Read Replies (2) \| Respond to of 11568

MCI's Internet Plan Seen as Progress by EU Regulator (Update1) Bloomberg News June 12, 1998, 1:02 p.m. ET MCI's Internet Plan Seen as Progress by EU Regulator (Update1) (Rewrites 1st section to add comment that Van Miert sees progress in MCI plan.) Washington, June 12 (Bloomberg) -- MCI Communications Corp.'s new proposal to divest Internet assets is a ''good sign'' of progress in negotiations over its $40.2 billion acquisition by WorldCom Inc., said Karel Van Miert, Europe's chief antitrust enforcer. MCI Chairman Bert Roberts Jr. presented the plan at a meeting Wednesday with U.S. antitrust enforcers, a person familiar with the talks said. The No. 2 U.S. long-distance carrier is seeking approval for the combination on both sides of the Atlantic. European Union regulators are assessing the new proposal ''in close cooperation'' with the U.S. Justice Department, Van Miert told Bloomberg News today after giving a speech in Stockholm. ''We'll sort it out together. It's a good sign things are moving.'' Van Miert previously said MCI's agreement to sell its wholesale Internet business to London-based Cable & Wireless Plc for $625 million in cash was inadequate. The EU regulatory chief said the offer failed to assure the combined company wouldn't dominate the business of carrying Internet traffic across a central network known as the backbone. He said the EU's concerns about the combination are shared by U.S. regulators, both of whom must grant their approval before the acquisition can be completed. An EU advisory committee plans to make a recommendation next week to give the EU time to meet a July 15 deadline for acting on the transaction. Roberts met late Wednesday with Justice Department antitrust chief Joel Klein to outline the company's intentions to sell more Internet assets, said a person familiar with the meeting. The Justice Department, following standard practice, is seeking an agreement from MCI to identify the assets it would sell as a condition for winning approval of the acquisition, the person said. Cable & Wireless sued MCI this week, accusing the long- distance company of reneging on its promise to give Cable & Wireless the first opportunity to bid on additional MCI Internet assets. Offers to sell these assets to other companies would result in ''immediate, severe, and irreparable harm to Cable & Wireless,'' the lawsuit said. Besides Cable & Wireless, potential bidders for MCI's Internet businesses include AT&T Corp., Sprint Corp., GTE Corp., and PSINet Inc., analysts said. Van Miert said it would be difficult technologically for MCI to divest its Internet assets because they are intertwined with the company's long-distance service. Van Miert suggested it would be easier for WorldCom to divest its recently acquired UUnet Technologies Inc. But WorldCom President Bernard Ebbers said UUNet is ''absolutely not'' for sale. ''It is no more a stand-alone unit than MCI Internet is,'' Ebbers said. ''''UUnet is about eight times bigger than MCI Internet.'' Ebbers said there ''are continuing discussions with the EU and the DOJ.'' MCI shares fell 5/8 to 48 by midday. WorldCom fell 5/16 to 41 15/16. Cable & Wireless fell 14 pence to 671p. --James Rowley in Washington at 202-624-1913 with reporting by