WASHINGTON-The European Commission in early July gave conditional approval to the proposed merger between MCI Communications Corp. and WorldCom Inc.
The approval is subject to the divestiture of MCI’s Internet services business, which overlapped with WorldCom’s to give the combined entity about a 50-percent market share. The companies in May announced a plan to sell MCI’s entire Internet service backbone to Cable & Wireless for US$625 million cash.
Under the Internet deal, MCI would sell 22 domestic nodes; 15,000 interconnection ports; more than 40 ongoing partnering agreements; and equipment dedicated to supporting the network, including switches and routers. Cable & Wireless also would acquire MCI’s contracts with its more than 1,300 Internet service provider customers.
The proposed MCI-WorldCom merger still must receive the approval of the U.S. Department of Justice and the Federal Communications Commission. MCI said it still expects the merger to close this summer. When the deal was announced in November, the companies said it would close in six to nine months.
