WASHINGTON – Qwest Communications International Inc. (Q) submitted a revised bid for MCI Inc. (MCIP) on Thursday in an effort to squash the long distance phone company's plan to be acquired by Verizon Communications Inc.
The revised bid increased the cash portion of the $8 billion offer by 21 percent to $9.10 per share and contains a mechanism to protect the value of the stock portion of the deal at the time of closing, the company said.
The new bid comes as some key MCI shareholders have questioned MCI Inc.'s decision to accept a $6.7 billion offer from Verizon (VZ) over an initial $8 billion offer from Qwest.
MCI's board said it would thoroughly review the new Qwest offer, as it has previous offers.
Analysts have said Verizon, the dominant local phone company in the Northeast and a top cellular player, likely won MCI's favor because it is larger and in better financial shape than Qwest.
Qwest, the local phone carrier in 14 Western and Midwestern states, is weighed down by more than $17 billion in debt, the lack of a wireless division and competition from cable and high-speed data companies.
In its initial $8 billion bid, Qwest offered $23 a share to MCI shareholders, comprised of $7.50 a share in cash and $15.50 of Qwest common stock based on a fixed exchange ratio of 3.735 Qwest shares per MCI share.
MCI shares closed up 26 cents at $23.21 on the Nasdaq Stock Market (search), but fell 41 cents to $22.80 in after-hours trading. Qwest shares rose 15 cents, or 3.7 percent, to close at $4.20 on the New York Stock Exchange and added a penny in after-hours trading, while Verizon shares fell 5 cents to $35.50 in regular trading but gained 31 cents in the extended session.