Verizon-MCI Merger Cleared by Justice Department
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NEW YORK and ASHBURN, Va. - Verizon Communications Inc. (NYSE:VZ) and MCI, Inc. (NASDAQ:MCIP) today announced they have received clearance from the U.S. Department of Justice for Verizon's acquisition of MCI.
Final closure of the transaction, which the companies anticipate will occur later this year or early in 2006, is subject to approval by the Federal Communications Commission. International approvals are already complete, as are the majority of necessary state-level regulatory reviews.
The FCC announced it has scheduled its vote on the Verizon-MCI combination on Friday (Oct. 28).
"We appreciate the hard work of the Department of Justice staff in bringing this merger to resolution," said John Thorne, Verizon senior vice president and deputy general counsel. "The consent decree will result in no disruption to MCI customers. We are eager to begin offering the benefits of this new combination to customers as soon as possible."
Paul Eskildsen, MCI senior vice president and deputy general counsel, said, "MCI is pleased with today's clearance by the Department of Justice of its merger with Verizon. This development represents another significant milestone in the regulatory approval process."
The DOJ filed a consent decree for approval by a Federal court that includes stipulations agreed to by Verizon and MCI. Under the decree, Verizon and MCI will lease dark (unused) fiber connections to 356 buildings in several states in the Verizon footprint on the East Coast.
Fiber currently being used by MCI to serve its customers will not be affected.
The consent decree follows an eight-month, comprehensive study by the DOJ staff of every aspect of the Verizon-MCI merger. Verizon, MCI and other parties supplied millions of documents and volumes of market data to the DOJ staff. "We proved that the transaction is pro-competitive and will not lessen competition in any market," Thorne emphasized.
The Verizon-MCI combination, part of the continuing evolution of the industry driven by customers and technology, will capitalize on the complementary strengths of each company and create one of the world's leading providers of communications services.
The merger will enable Verizon to better compete for and serve large-business and government customers with a full range of services, including wireless and sophisticated Internet protocol-based services.
It will benefit consumers and businesses by creating a supplier with the financial strength to maintain and improve MCI's extensive Internet backbone network.
The Verizon-MCI combination was announced on February 14, 2005.
Verizon Communications Inc. (NYSE: VZ), a Dow 30 company, is a leader in delivering broadband and other communication innovations to wireline and wireless customers. Verizon operates America's most reliable wireless network, serving 49.3 million customers nationwide, and one of the nation's premier wireline networks, serving home, business and wholesale customers in 28 states. Based in New York, Verizon has a diverse workforce of nearly 215,000 and generates annual revenues of more than $71 billion from four business segments: Domestic Telecom, Domestic Wireless, Information Services and International. For more information, visit www.verizon.com.
MCI, Inc. (NASDAQ: MCIP) is a leading global communications provider, delivering innovative, cost-effective, advanced communications connectivity to businesses, governments and consumers. With one of the most expansive global IP backbones and wholly-owned data networks, MCI develops the converged communications products and services that are the foundation for commerce and communications in today's market. For more information, go to www.mci.com.
NOTE: This press release contains statements about expected future events and financial results that are forward-looking and subject to risks and uncertainties. For those statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The following important factors could affect future results and could cause those results to differ materially from those expressed in the forward-looking statements: a significant change in the timing of, or the imposition of any government conditions to, the closing of the transaction; actual and contingent liabilities; and the extent and timing of our ability to obtain revenue enhancements and cost savings following the transaction. Additional factors that may affect the future results of Verizon and MCI are set forth in their respective filings with the Securities and Exchange Commission, which are available at investor.verizon.com/SEC/ and www.mci.com/about/investor_relations/sec/.