MCI Worldcom, Sprint make merger intent official

MCI WorldCom and Sprint on Wednesday filed papers with the Federal Communications Commission (FCC), opening their potential merger formally to federal scrutiny over whether the union constitutes a telecom monopoly.

Officials from the two companies on Wednesday briefed reporters on how they intend to play the merger to the FCC and the Department of Justice, which will review the deal from an antitrust standpoint.

Specifically, the two companies bill their pending merger as a blending of the "No. 4" and "No. 7" players in an increasingly crowded field.

"In the post-merger world, AT&T, SBC, and Bell Atlantic will be bigger than we are. We would be No. 4," said Michael Salsbury, MCI WorldCom's general counsel.

Salsbury and Richard Devlin, Sprint vice president, general counsel and external affairs, drove home the notion that the two companies should no longer be thought of as two in a pack of three long-distance giants.

Instead, MCI WorldCom and Sprint officials characterise themselves, given the changed telecom landscape, as strong contenders among a mix of companies that have grown strong through mergers.

When pressed about the feeling among corporate-enterprise customers that the merger shortchanges those customers on options, Sprint's Devlin said the two companies need to do more in terms of demonstrating to that crowd the potential benefits of the merger.

"Maybe we do need to a better job showing how the merger will result in more options and lower costs for our enterprise customers," Devlin said.

Still, officials from both companies pointed out that even large corporate customers are increasingly turning to companies other than the "Big 3" for telecom services.

MCI WorldCom and Sprint hope to have the merger blessed by regulators and wrapped up by mid-2000. Both Devlin and Salsbury said neither company is discouraged by early reports that the union may not pass muster among government regulators.

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More about AT&TDepartment of JusticeFCCFederal Communications CommissionMCIMCI WorldComSprintWorldCom

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