September 23, 2004 Cedar Knolls, NJ -- MCI has formally placed itself in play by retaining investment bankers to advise the company on selling it. According to Probe Financial Associates, MCI is in such a weakened condition, this step "signals a surrender."
"MCI was weakened severely under the Ebbers' regime and the resulting bankruptcy and the prolonged bankruptcy proceedings reduced the company in size and scope," reports Allan Tumolillo, COO of Probe Financial Associates. "The final straw was the RBOCs' ability to have the Courts and the FCC undo UNE-P. This left MCI and other long distance carriers out in the cold in the consumer markets."
With VoIP poised to come on strong and with AT&T already in an alliance with cable, MCI has very few ways of leveraging its installed base, says Tumolillo, who adds that said base is "dwindling daily."
MCI's main strength is in the Enterprise sector, and its customer base may prove to be attractive to one of the RBOCs. AT&T may be the one company with the most to gain in acquiring MCI.
Probe's new report, "MCI Is Now on the Block: Assessing Possible Buyers," analyzes who might acquire MCI and why. For more information, visit the company's Web site at www.probefin.com.