WorldCom won the bidding war for MCI Communications, besting GTE Corp. and British Telecom for control of the second-largest long-distance telephone service provider in the U.S. The $37 billion stock deal will be the largest corporate merger in U.S. history, creating a new company named MCI WorldCom. MCI Chairman Bert Roberts will become chairman of MCI WorldCom and WorldCom president-CEO Bernard Ebbers will become president and chief executive. No other executive officers were immediately named.
Telecom industry analysts say the key to the deal lies in MCI's tremendous marketing ability--and whether WorldCom will be able to retain the MCI executives behind the marketing muscle. WorldCom until now has been a novice advertiser with a $10 million budget at Earle Palmer Brown, Bethesda, Md. MCI controls a far larger ad budget, estimated at $335 million, handled by Messner Vetere Berger McNamee Schmetterer Euro RSCG, New York.
Copyright November 1997, Crain Communications Inc.