Verizon has bought rival telco MCI for $6.7 billion, ending a week of speculation.

Verizon said the acquisition would accelerate its plans to become a significant player in the enterprise services market, giving it a broader reach globally, a suite of advanced IP services and a large base of business and government customers.

Getting regulatory approval for the deal is likely to take as much as a year, the companies said. Verizon must also win the approval of MCI's shareholders. The board of directors at both companies have approved the agreement, they said in a statement.

Verizon will pay $4.8 billion in shares and $488 million in cash to buy MCI. MCI, meanwhile, will pay its shareowners quarterly and special dividends of $4.50 per share, worth $1.46 billion, bringing the total value of the deal to $6.746 billion.

Verizon CEO Ivan Seindberg called the deal "a natural and logical extension of Verizon's strategy to transform our company to serve growth markets and offer broadband technologies."

The companies will figure out their branding strategy, organisational structure and other details closer to the completion of the deal, they said. Verizon will take on MCI's net debt when the deal closes, projected to be about $4 billion.

The deal comes two weeks after SBC said it would acquire AT&T for $16 billion. Qwest, which had been trying to broker its own deal with MCI, now finds itself on its own, and analysts last week speculated over plans that BellSouth and Sprint might have plans for a deal with a competitor or with each other.