February 17, 2005 1:22 PM PST

Qwest move could keep MCI bid alive

(continued from previous page)

confident that our board has made the right decision for our shareholders, customers and employees," said Peter Lucht, a spokesman for MCI.

Qwest was not available for comment.

During Qwest's quarterly conference call with investors Tuesday, company CEO Richard Notebaert seemed disappointed with MCI's decision. But he did not indicate that Qwest would try to make a counter offer.

"There was $1 billion in cash left on the table," Notebaert said. "$1 billion is a lot of shareholder value to leave on the table. But that decision's been made, and it's time to move forward."

Although Qwest's offer was higher than Verizon's, some analysts argued that the Verizon deal is better for MCI in the long term.

"The MCI shareholders that are complaining tend to be more short term-focused," said Brad Wilson, an analyst at Legg Mason. "I think the bondholders and the longer-term investors are looking at the Verizon deal the same way the board has."

The offers from Verizon and Qwest are made up mainly of stock equity. Wilson said that since Verizon's stock has historically been more stable, and because the company is financially more secure than Qwest, it offers longer-term investors more security.

Hasan said MCI investors have already seen the value of their investments increase as talk of an acquisition grew.

"It's a little disingenuous for the MCI shareholders to say they are getting a raw deal from Verizon, since the stock has been gaining on all the acquisition speculation," he said. "But shareholders are never happy with the price of an acquisition. It's in their nature to want the best price possible."

Previous page
Page 1 | 2
 

Join the conversation

Add your comment

The posting of advertisements, profanity, or personal attacks is prohibited. Click here to review our Terms of Use.

What's Hot

Discussions

Shared

RSS Feeds

Add headlines from CNET News to your homepage or feedreader.