Based on the recent round of raise and re-raise, it appears that Qwest have finally abandoned their bid to acquire MCI. This is allegedly based on some guidance from MCI executives that major customers were hinting they would terminate their contracts if Qwest should win the bidding war.
Over all this is good news for MCI shareholders, customers and employees alike. Verizon brings much deeper pockets to the situation. Deep pockets which are needed to re-build a still badly-wounded MCI.
In the end, I actually think this will be a better result for Qwest, too. There just was no real room for Qwest to achieve the synergies they needed in order to make this deal cost-effective. You just cant wring that much out of MCIs operations. This company has been battered down so much from the WorldCom collapse that its like a skeleton crew is running the ship. An acquisition by Qwest would have destroyed both companies. It appears to me that MCI’s major customers realized the extreme impact Qwest’s custs would have had on the level of service they would receive from the merged company and made their opinions known.
