Verizon Closes MCI Deal

The $8.5 billion merger closes on schedule.
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Verizon

(VZ) - Get Report

closed its $8.5 billion acquisition of

MCI

(MCIP)

.

MCI shareholders will receive 0.5743 Verizon shares and cash for each of their MCI shares. Verizon elected to make a supplemental cash payment of $2.738 per MCI share (or $779 million in the aggregate), rather than issue additional shares of Verizon, so that the merger consideration was equal to at least $20.40 per share of MCI. The parties mutually agreed that there would be no purchase price adjustment related to the amount of certain MCI liabilities.

New York-based Verizon said trading in MCI shares would cease at the end of trading Friday. Verizon said it renamed the acquired operations Verizon Business. The closing of the huge deal comes just a month after Verizon's archrival, Texas-based Bell

AT&T

(T) - Get Report

, completed its own big acquisition.

The completion of the Verizon deal comes just a day after MCI, the successor to the once-highflying WorldCom telco that crashed into a 2002 bankruptcy amid a massive accounting fraud, rolled out its latest earnings restatement. MCI said it would shave $52 million from reported profits in the last three quarters to set right errors related to contributions to the Federal Universal Service Fund.