The ongoing tug-of-war between Verizon and Qwest for ownership of MCI has taken of again with the release of a statement by MCI's board on Saturday that it now considers Qwest $9.9 billion offer as "superior" to Verizon's $7.6 billion.
Qwest submitted the revised offer on Friday and gave MCI until 5pm Eastern Time on Saturday to consider it. The offer is worth $30 per MCI share and consists of $16 in cash and $14 in Qwest stock, which is substantially more than the deal accepted from Verizon in late March.
Although MCI's board has decided that the $30-per-share Qwest offer is superior, it hasn't yet changed its recommendation to shareholders to accept the Verizon deal. Under the terms of merger previously agreed, Verizon has until Friday to submit a revised offer or let its current offer stand. MCI's board then has until 3 May to change or keep its current recommendation. A termination of the deal with Verizon would come with a $240 million penalty to MCI, according to Verizon.
Qwest said in a statement that it was "gratified" with the decision of MCI's board.
Verizon said it believes its deal represents the best short and long term deal for MCI shareholders and that it will "consider all of our options and determine how best to serve Verizon shareholders".
The fight for MCI began in mid-February when the carrier accepted an acquisition offer from Verizon worth $6.7 billion. Qwest has submitted counter-offers that have been turned-down by MCI but the competition did result in Verizon hiking its offer to about $7.6 billion. The Qwest offer made on Friday was worth $9.9 billion.