February 11, 2005 — (WEB HOST INDUSTRY REVIEW) — According to reports, telecommunications carrier Verizon (verizon.com) is in serious merger talks with MCI (mci.com) and could announce a deal in the next few days.
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Verizon reportedly made an informal acquisition offer to MCI yesterday worth close to the $6.3 billion reportedly put on the table by Qwest Communications last week.
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MCI has been considering selling for several months. However, the recent SBC acquisition of AT&T appears to have intensified the pursuit of MCI.
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Like AT&T, MCI is an attractive asset because of its extensive national infrastructure and strong corporate customer base. MCI also has strong Web hosting capabilities, bolstered by a strong enterprise hosting base built through its acquisition of Digex.
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Last year MCI emerged from the largest bankruptcy in corporate history and is reported to have only $6 billion in debt to go with $6 billion in cash.
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Between the two suitors, Verizon is in the best financial shape as Qwest is mired in debt and has far less annual revenue. BellSouth is also rumored to have considered pursuing MCI.
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MCI, Qwest and Verizon have all turned down media requests for comment.
