M&A

MCI Shareholders OK Deal with Verizon

Earlier this year Qwest had submitted a higher bid for the nation's second-largest long-distance carrier that was ultimately rejected.
Stephen TaubOctober 6, 2005

MCI Inc. and Verizon Communications Inc. took another giant step closer to consummating their $8.4 billion merger on Thursday, when MCI shareholders overwhelmingly voted to approve the deal.

According to an MCI statement, 64.2 percent of outstanding shares and 88.2 percent of votes cast were in favor of the merger.

Earlier this year Qwest Communications International Inc. had submitted a higher bid for the nation’s second-largest long-distance carrier that was ultimately rejected. In a press release at the time, MCI stressed that the offering price was not the only factor when it decided to accept Verizon’s lower bid; a large number of MCI’s most important business customers, it added, had indicated that they preferred Verizon to Qwest as a merger partner.

Last week Qwest decided not to renew its takeover offer. Bloomberg noted that this hurt the efforts of hedge fund Deephaven Capital Management, which was leading opposition to the merger in hopes of soliciting a higher price.

The transaction still awaits approval from the Federal Communications Commission, the Department of Justice, 13 of 31 states where the companies do business, and international regulators.