BT Lets MCI Talk to Other Merger Suitors

Freed to talk by one-time suitor British Telecommunications, MCI Communications Corp. said it plans to meet with GTE Corp. and WorldCom Inc. to discuss their multibillion-dollar proposals to acquire the company. With WorldCom’s bid of $30 billion and GTE’s $28 billion on the table, MCI said that BT had lifted a restriction that would have prevented it from talking to the suitors. The latest move set the stage for new bids that could escalate beyond what already would be the most expensive cash corporate takeover in history. MCI said it will begin talks as early as next week. BT, the suitor that was presumably left out in the cold by WorldCom’s bid, suddenly is back in the picture, possibly as a matchmaker or as a participant in a three-way deal. BT already owns 20% of MCI and through the agreement it launched a year ago and renegotiated in August, has offered to pay $17 billion for the remaining 80%. Sources familiar with the situation said GTE’s efforts to woo BT could open the door to a three-way deal that could eclipse WorldCom’s all-stock bid.