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To: Anthony Wong who wrote (2671)	6/19/1998 12:11:00 PM
From: Anthony Wong	Read Replies (1) \| Respond to of 11568

FOCUS-WorldCom/MCI in last-ditch talks with EU Friday June 19, 11:27 am Eastern Time By Amelia Torres BRUSSELS, June 19 (Reuters) - WorldCom Inc (WCOM - news) and MCI Communications Corp (MCIC - news) held talks with the European Commission on Friday about winning approval for their merger, but it was unclear whether they were successful. The negotiations ran right up to the start of a meeting of merger advisers from the 15 European Union states. The highly-secretive panel met for four hours but members declined to comment on the outcome of their discussions. ''There were discussions with the Commission up to the last minute on a new proposal,'' a member of the advisory merger committee told Reuters. Commission spokesman Stefan Rating refused to say anything. The committee received a draft decision to ban the $37 billion deal between the two U.S. telecommunication firms about two weeks ago, when the companies proposals to address EU antitrust concerns they would dominate the supply of Internet backbone services were judged insufficient. But they were informed of new offers by the companies to sell more of MCI's Internet businesses to eliminate any overlap with WorldCom's own Internet service provider UUNet Technologies. A Commission official came out of the meeting, which took place in the Commission's modern concrete conference centre, with a one-inch thick file which said ''MCI - remedies.'' But like the other members he kept mum. Remedies is EU jargon for the concessions, normally asset sales, companies must make to win merger approval. The Commission does not normally inform the public about the outcome of the advisory committee meetings and the committee members are instructed not to reveal their opinions. The only exception was the merger between Boeing and McDonnell Douglas a year ago where the Commission thought it better to inform the press due to the huge tension across the Atlantic over the European demands. Although in principle the committee could meet again if the companies had not offered enough to meet the EU's competition concerns, it was unclear whether this would happen. One committee member said they would not come back. ''The Commission has to make a decision taking into account our opinion,'' he said. But when asked whether they had agreed their final recommendation another member just said ''who knows.'' The general feeling among people close to the talks is that WorldCom and MCI may have made enough concessions, or made likewise pledges, to win regulatory clearance for their merger filed to the EU Commission last November. The Commission, which is working under formal deadlines, has until July 15 to give its verdict, but wants to take the issue to its weekly meeting on July 8. It is currently consulting with rival firms on the additional conditions. MCI last month agreed to sell its wholesale Internet business to Cable & Wireless for $625 million, but regulators later said that divestiture was inadequate. It now seeks the blessing of regulators on a revised divestiture plan before seeking buyers for any additional assets. The Commission is considering requiring MCI to transfer all its Internet customers, including business and residential customers, and to meet stringent non-compete provisions, a source familiar with the EU inquiry said. The non-compete provision would prevent the backslide of customers who are transferred to the company that buys MCI's Internet assets. MCI and WorldCom also may be required to refuse service if they are approached by customers of the new owner, the source said. MCI also may be asked to divest its intranet and extranet business and other peripheral services such as managed firewalls, the source said. GTE Corp. (GTE - news) and Sprint Corp. (FON - news), two other U.S. telecoms companies, have been the most vocal opponents of the deal. European phone companies such as Belgium's Belgacom, British Telecommunications (quote from Yahoo! UK & Ireland: BT.L) and Deutsche Telekom (DTEG.F) have also expressed their views on the merger, sources said. biz.yahoo.com