MCI Studying WorldCom's Takeover Bid

Associated Press

MCI broke a week of silence on WorldCom's $29.4-billion takeover offer, with its board directing management to seriously explore the bid. MCI managers will weigh WorldCom's offer, made last week, against a long-standing agreement to be acquired by London-based British Telecommunications. The development is welcome news to Jackson, Miss.-based WorldCom Inc., but it doesn't mean that a deal between the two companies is a foregone conclusion, analysts said. As it looks at WorldCom's proposal, MCI will be scrutinizing whether the stock deal will hold its value and whether it will pass muster with regulators. WorldCom is offering about $9 billion more than British Telecom. MCI and BT, however, have cleared all major regulator hurdles here and abroad, giving them regulatory certainty. Washington, D.C.-based MCI expects to decide within the next few weeks whether to negotiate with WorldCom, people close to the companies have said. MCI's board said it is continuing the process of implementing its merger with BT. MCI shares dipped 13 cents to close at $35; WorldCom shares fell 56 cents to close at $36.56. Both trade on Nasdaq.

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