Business Desk
This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.
TELECOMMUNICATIONS
VERIZON EXPECTED TO RAISE MCI BID
Verizon is widely expected to boost its bid for MCI again now that the long-distance phone company has embraced a rival $9.75 billion bid from Qwest, though it remains unlikely Verizon will need to pay that much to win MCI back. Analysts say MCI’s board had little choice but to declare Qwest’s latest offer superior by Saturday’s deadline, given its dubious legal grounds for sticking with a Verizon deal worth just $7.5 billion. But that means, to Qwest’s dismay at being treated as a second-rate suitor, that its “best and final” offer will amount to just another bargaining chip for MCI’s board – unless Verizon unexpectedly surrenders after a three-month bidding war. Starting Monday, Verizon has five days to respond with an improved offer for MCI or walk away with a $240 million breakup fee. It also has the right to ignore that deadline and force MCI investors to vote on its existing deal, hopeful that enough fear Qwest’s shaky finances and strategic outlook. MCI’s board has repeatedly expressed concern about Qwest’s $17 billion debt load and the long-term value of the Qwest shares MCI investors would receive as partial payment. MCI’s board has twice accepted lower-priced deals with Verizon. Regardless of who wins, analysts are questioning whether the bidders are at risk of overpaying for MCI’s struggling business
– Associated Press
WALL STREET
WALL STREET JOURNAL: LANGONE SEEKING TO BUY NYSE
A Former New York Stock Exchange director, Kenneth Langone, has been seeking financial backers on Wall Street for an attempt to acquire the New York Stock Exchange, the Wall Street Journal reported on its Web site yesterday.
Such a purchase could spell trouble for the exchange’s planned purchase of the electronic-trading platform Archipelago.
Sources told the Journal that Mr. Langone wants to block the Archipelago-NYSE deal out of outrage that Goldman Sachs has acted as an adviser to both parties, which many on the Street regard as a conflict of interest.
A bid by Mr. Langone, a co-founder of Home Depot, for the NYSE would be fraught with a number of problems.
Mr. Langone has staunchly supported former NYSE chief Richard Grasso during his tussle with the Big Board over the size of his compensation package. New York State Attorney General Eliot Spitzer is currently suing both in the matter.
– Staff Reporter of the Sun
