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Technology Stocks : WCOM -- Ignore unavailable to you. Want to Upgrade?

To: paul t who wrote (2905)	7/15/1998 5:11:00 PM
From: Anthony Wong	Respond to of 11568

WCOM-MCIC merger gets Fed OK Net sale to Cable & Wireless biggest divestiture ever By Rex Nutting, CBS MarketWatch Last Update: 03:59 PM July 15, 1998 WASHINGTON (CBS.MW) -- The Justice Department approved WorldCom's $44 billion acquisition of MCI Communications Inc. Wednesday after MCI agreed to sell all of its Internet backbone and service businesses to Cable & Wireless for about $1.75 billion. The approval by the Justice Department was widely expected after the European Commission OK'd the deal last week after pressuring MCI (MCIC) to divest more of its Internet assets than it originally intended. By adding MCI's assets, WorldCom (WCOM) will become the nation's second largest long distance carrier and the world's second largest carrier of international voice traffic. It would have more than 22 million residential and small business customers. It will also have a significant presence in the Internet backbone. The merger would still need to be approved by the Federal Communications Commission and the Federal Trade Commission. The biggest hurdle at the FCC is the charge by critics of the merger that the combined companies will not aggressively compete in the local telephone market. The sale of the Internet businesses to Cable & Wireless (CWP) is the largest divestiture in U.S. merger history, the government said. Without the divestiture, WorldCom/MCI would have controlled a "significant portion of the nation's Internet traffic, giving the company the ability to cut off or reduce the quality of Internet services that it provided to its rivals," said Assistant Attorney General Joel I. Klein. "This divestiture benefits anyone who relies on the Internet because it preserves competition among major Internet service providers," Klein said. "Consumers will benefit with lower prices, higher quality, and greater innovation in this dynamic and emerging industry." Rex Nutting is Washington bureau chief for CBS MarketWatch. CBSMW MarketPlace cbs.marketwatch.com