Updated from 12:52 p.m. EDT

Shares of telecom firm

Qwest

(Q)

plunged Monday after the carrier ditched its plans to sell its long-distance network.

The Denver, Colo.-based firm had been looking for

bidders

for its national fiber-optic network business, part of a long-term strategy to rein in costs and reduce debt.

The news pushed Qwest's shares down Monday as investors digested the news. Qwest's shares fell 24 cents, or 5.8%, to $3.93, outpacing the broader decline in tech stocks that saw the Nasdaq slip 0.4%.

"Although there was significant interest in this process from prospective buyers, the company and its board of directors have determined that the long-distance network asset holds far more value to Qwest shareholders," said the company, in a statement.

The Wall Street Journal

recently reported that Qwest had received bids

below

the $2 billion to $3 billion it had originally sought for its long-distance business.

Level 3 Communications

(LVLT)

,

XO Communications

, and

TW Telecom

(TWTC)

were all cited as potential purchasers, although Qwest has now decided to end the sale.

"

The long-distance network is more strategically important to Qwest and its customers than is the alternative of pursuing a transaction," the company added, in its statement.

Qwest, which was recently

upgraded

by JP Morgan, also reaffirmed its 2009 guidance, and expects free cash flow between $1.4 billion and $1.5 billion. For the full year, Qwest anticipates adjusted EBITDA of $4.2 billion to $4.4 billion.

"Qwest remains confident in its outlook for 2009 and the ability of its businesses to continue to perform," said Edward Mueller, the Qwest CEO, in a statement. "We have always taken a disciplined, prudent approach to assessing our business in this ever-changing industry."

The company

beat

its first-quarter profit targets thanks to deep cost cuts but is wrestling with $13.3 billion of debt. Selling the firm's long-distance network could have reduced this debt load, and also helped Qwest deal with heightened price competition.

Qwest, which competes with

AT&T

(T) - Get Report

,

Verizon

(VZ) - Get Report

and

Sprint

(S) - Get Report

, saw its first-quarter sales slip to $3.17 billion, down from $3.4 billion a year ago. This, however, was largely due to Qwest's exit from the wireless business.

The company's decision to keep its long-distance network could nonetheless

help

other parts of its business, such as local phone services and national offerings for government organizations and companies.

Shares of Qwest's main rivals also slipped in Monday trading. Sprint's stock fell 2.9%, and AT&T slipped 0.7% and Verizon gained 0.1%.