EDS, MCI WorldCom reportedly in talks

MCI WorldCom and services provider Electronic Data Systems (EDS) reportedly are in talks to establish a joint venture operation.

Spokesmen for both companies declined to comment today on a report by the Dow Jones News Service. The spokesmen cited policies that neither company comments on rumor or speculation. The proposed joint venture would aim to offer business customers worldwide a wide range of voice, data and computer services, according to the published report today.

Under the terms of such a deal, EDS would assume management of MCI WorldCom's international billing and information systems, the report said. Such an outsourcing arrangement would result in perhaps thousands of staff at the telecom joining EDS, while other MCI WorldCom employees might face redundancy, the report added.

In an exchange of company businesses, MCI WorldCom could end up dealing with most of EDS' telecom-related business, while the services provider may purchase and take over most of the carrier's computer systems operations, the report said.

MCI WorldCom confirmed Friday that it would be laying off around 2000 of its US workers as of December 31. Most of the staff cuts are occurring in its network operations where duplications exist the company said following the $US40 billion acquisition of MCI Communications by WorldCom, which closed in September.

MCI WorldCom launched a takeover bid for Australian Internet Service Provider, OzEmail, on Monday.

On Thursday, EDS announced the appointment of a new chairman and chief executive officer - the former CEO of Cable & Wireless Dick Brown. He is due to take over at EDS on January 15, 1999.