Still obviously stinging from its high-profile abandoned bid for MCI, Qwest is nonetheless in the market to buy more carriers, and is available to take another run at MCI if shareholder discontent derails the merger with Verizon. CEO Dick Notebaert said at Sanford Bernstein’s Strategic Decisions Conference that “if we’re going to have a viable competitive market…there will have to be further consolidation in the other industry players and I think Qwest” is in a good position to do that.
I’m sure that as people wake up and look a couple of years out, they will see the same picture we see. If you are going to be successful competing against those two [SBC and Verizon], you’re going to have to have a larger partner and be part of a larger entity.
But, for the really big telcos, mandatory access to facilities is critical, Notebaert said. He’s confident that will happen too. “Our expectation is that the Department of Justice and the FCC will ensure that, so that people can’t lock up networks the way the cable industry has.”
Notebaert seemed refreshingly honest about why Qwest halted its months-long pursuit of MCI, particularly given that so many MCI shareholders were rooting for a Qwest merger given that deal’s higher value. “After taking four unsolicited runs at this thing and never being embraced very warmly…we thought it was better to go to plan A,” he said.
But the game may not be entirely over yet. Hedge fund-run shareholder revolts at MCI might make closing a deal with Verizon difficult. “If the shareholders choose to vote that down, we will be very thoughtful and available,” Notebaert said.
Cynthia Brumfield at 9:24 PM|Comments(0)
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