Qwest Chief Calls MCI Bidding Over; Notebaert Defends Decision To Quit Three-Month War; Some Still Disappointed

• Published in: The Wall Street journal. Eastern edition
• Main Author: Young, Shawn
• Format: Newspaper Article
• Language: English
• Published: New York, N.Y Dow Jones & Company Inc 25.05.2005
• Edition: Eastern edition
• Subjects: Acquisitions & mergers; Service introduction; Settlements & damages; Stock exchanges; Stockholders; Telecommunications industry; United States > US
• ISSN: 0099-9660

Ending a furious three-month bidding war, long-distance phone titan MCI this month turned down a $9.74 billion takeover offer from Qwest, a local and long-distance phone company, in favor of a $8.44 billion offer from the more financially secure Verizon Communications Inc., a large New York-based phone company. Some of MCI's largest shareholders criticized MCI's board for taking the lower bid and urged Qwest to persist, but Mr. [Richard Notebaert] indicated that it wouldn't happen. "It's regrettable," said Leon Cooperman, the chairman and chief executive of Omega Advisors Inc., a hedge fund that owns about 12 million shares of MCI and had agitated in favor of Qwest. "Qwest was a very credible buyer." The courtship of MCI highlighted the challenges faced by Qwest, which has about $17 billion in debt and is the smallest of the regional Bell companies that dominate the U.S.'s local-phone market. Buying MCI would have helped Qwest with its debt and vaulted it into the No. 2 spot, after AT&T Corp., in selling phone and data services to corporate customers. Now, Qwest could seem dwarfed as Verizon buys MCI and SBC Communications Inc. takes over AT&T.