MCI to Sell Internet Assets to British Firm

MCI Communications Corp. is selling its Internet facilities to Britain’s Cable & Wireless for $625 million in a move designed to allay qualms on both sides of the Atlantic that the company’s planned merger with WorldCom Inc. might violate antitrust laws. The cash transaction is contingent upon approval of the MCI-WorldCom merger by U.S. and European authorities, an MCI spokesman said. European and U.S. regulators are closely reviewing whether the combined company would crimp competition and possibly raise prices in the Internet “backbone” business. Internet backbones are high-capacity networks that carry Internet and other data traffic for third parties. The European Union’s competition commission has said elimination of any overlap in WorldCom and MCI’s Internet holdings could be necessary to win approval for the $37-billion merger. The EU has a July 15 deadline for deciding. The merger is subject to approval in Washington by the Justice Department and the Federal Communications Commission. “Our investigation is continuing, and we would look at this [MCI’s sale] aspect as well,” the Justice Department’s antitrust division spokeswoman Gina Talamona said. The FCC had no immediate comment.