Don’t play stud poker with Bernie Ebbers. Just when it looks like you’ve got a sure hand, he’s likely to pull an ace from the hole.
And so went the dramatic bidding for the largest corporate merger ever.
Last month, BellSouth, the dominant local phone company in the Southeast, bid a whopping $100 billion to buy Sprint, the nation’s third-largest long distance provider, and sent a signal that it cannot afford to be left behind in today’s global telecommunications market. With the clock ticking, Bernie Ebbers, CEO of Clinton-based MCI WorldCom, bid $115 billion. The deal, as later announced, is worth $129 billion, including $115 in equity and $14 billion in assumed debt.
Jimmy Heidel, executive director of the Mississippi Department of Economic and Community Development, said the reported merger of MCI WorldCom and Sprint would be “a dream come true for the state of Mississippi.”
“I can’t think of a better partnership, a more productive synergy, than can be produced by these preeminent players on the global telecommunications stage,” Heidel said. “When I go to national conferences and meetings out of state and the words ‘Mississippi’ and ‘MCI WorldCom’ are mentioned in the same sentence, I don’t have to show a map any more. Corporate America is recognizing that the road to the future in high technology runs through Mississippi.”
Blake Wilson, president of Mississippi Economic Council, said MCI WorldCom is to Mississippi what the Mercedes plant is to Alabama.
“The big difference is that Alabama had to go out and bring Mercedes there,” Wilson said. “In Mississippi, Bernie Ebbers chose to grow it here. It has a tremendous positive impact on the image of the Jackson community in specific and our overall state as well. The Sprint deal makes it even more dramatic.”
Hu Meena, president of Jackson-based Cellular South, the state’s largest provider of wireless products and services, called the MCI WorldCom/Sprint engagement “a good deal.”
“The Sprint acquisition is good for Mississippi,” Meena said. “And what’s good for Mississippi is good for Cellular South.”
Glynn Ingram, president and CEO of Unity Communications, said, “Thanks to the vision of Bernie Ebbers, the consolidation of MCI WorldCom and Sprint will contribute greatly to the economic growth of the state and the metro area.
“As home to the world’s second largest telecommunications company, the purchase will not only showcase Mississippi’s world-class workforce and excellent economic climate, but will potentially lead to the creation of numerous new businesses to support this telecommunications leader,” Ingram said.
Suzanne J. Wilkinson, chief financial officer of Jackson-based ValuePage, said a merger with Sprint will provide MCI WorldCom with an extensive wireless network for voice and data transmission.
“Wireless is the telecommunications growth sector,” Wilkinson said. “It’s imperative that MCI WorldCom be a serious PCS player if it wants to see continued exponential growth.”
J. Harmon Bays, a financial advisor with Legg Mason Wood Walker Inc. in Jackson, said the deal is “extremely positive” for MCI WorldCom and Sprint.
“By combining the No. 2 and No. 3 long distance providers in the country, there are many benefits that each company brings to the table,” Bays said. “The major benefit for MCI WorldCom is that they will obtain an already established wireless network. This will bring them that much closer to being able to offer their customers ‘one-stop shopping’ with long distance, Internet, wireless and local access.”
In September, SkyTel shareholders approved the sale of its company, in a deal worth approximately $1.8 billion in stock and debt, to MCI WorldCom. Earlier this year, MCI WorldCom Inc. announced plans to acquire another Jackson-based business: Wireless One, the largest wireless cable operator in the Southeast and a company that sought bankruptcy protection in February.
In addition to other acquisitions and partnerships, MCI WorldCom, the 14th largest company in the world, recently announced an expansion and upgrade of its Asian network facilities and service operations center in Hong Kong. Approval of the MCI WorldCom-Sprint deal, which faces scrutiny from the Federal Communications Commission, is expected to take at least a year.
Contact MBJ contributing writer Lynne Wilbanks Jeter at firstname.lastname@example.org or email@example.com.
BEFORE YOU GO…
… we’d like to ask for your support. More people are reading the Mississippi Business Journal than ever before, but advertising revenues for all conventional media are falling fast. Unlike many, we do not use a pay wall, because we want to continue providing Mississippi’s most comprehensive business news each and every day. But that takes time, money and hard work. We do it because it is important to us … and equally important to you, if you value the flow of trustworthy news and information which have always kept America strong and free for more than 200 years.
If those who read our content will help fund it, we can continue to bring you the very best in news and information. Please consider joining us as a valued member, or if you prefer, make a one-time contribution.Click for more info