Verizon Communications Inc., whose deal to acquire MCI is currently worth $1.9 billion less than Qwest's bid, has consented to MCI's request for a waiver to conduct further discussions. MCI, formerly WorldCom, instructed its advisers and management to reopen the talks ''promptly." The company declined to say how long it will take to decide whether it still sees the lower price Verizon is paying as justified due to Qwest's far weaker financial condition.
Verizon said it has given MCI until Monday to conclude the talks.
A recent drop in Verizon's share price has cut the value of that cash and stock deal from the original $6.75 billion to $6.56 billion, intensifying pressure on MCI's board to give Qwest another look. With such a large difference in price, it might be difficult for MCI's board to stand by its original contention it's a less risky merger partner.
A determination that Denver-based Qwest's offer is superior would trigger a five-day window for a counteroffer from New York-based Verizon.
Verizon chief executive Ivan Seidenberg criticized multiple aspects of Qwest's proposal, particularly calculations the deal would generate $2.8 billion a year in cost savings.