Feeds

MCI faces shareholder fury

Moody merger gets moodier

  • alert
  • submit to reddit

The Power of One Brief: Top reasons to choose HP BladeSystem

MCI, which last week agreed to be bought by Verizon, has been forced onto the defensive over the deal.

Michael Capellas, MCI's chief executive, is under pressure to explain why he took the lower offer for the firm. Verizon offered $6.7bn to buy MCI, which the board accepted. But a rival $8bn bid from Qwest was rejected.

Rebel MCI shareholders are so unhappy at the deal that some have started court action. MCI directors are accused of breaching their fiduciary duties - their legal responsibilities as board members.

Shareholder Paul Pojanowski filed a lawsuit in the Delaware Chancery Court on Friday. The case describes Verizon's offer for MCI as "unconscionable, unfair and grossly inadequate". It asks the board to hold an open auction for the firm and give proper consideration to Qwest's rival offer, according to the FT. Institutional investors representing more than ten per cent of MCI's stock have already said they are unhappy with the deal.

Carlos Slim, MCI''s largest single shareholder, is still to make up his mind on the merits of the merger.

Capellas insists Verizon offers a more secure future for MCI. ®

Related stories

Qwest to bid again for MCI
Qwest goes public with $8bn MCI bid
Verizon and MCI to tie the knot

Boost IT visibility and business value

More from The Register

next story
UK's emergency data slurp: IT giants panicked over 'legal uncertainty'
PM says rushed-through DRIP law will 'plug holes' in existing legislation
Doctor Who season eight scripts leak online
BBC asks fans to EXTERMINATE copies before they materialise
Google went behind our backs and really HURT US, squeal upset porn kingpins
'As the pornographer here, the moral turpitude should be MINE'
Report: UK.gov wants to legislate on comms data BEFORE next election
Ministerial alarm sets in over EU court's data retention ruling
IBM's $3bn bet on next-gen computers: Carbon nanotubes, neuro chips
Big Blue exec tells El Reg what to keep an eye on
prev story

Whitepapers

Seven Steps to Software Security
Seven practical steps you can begin to take today to secure your applications and prevent the damages a successful cyber-attack can cause.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Eight steps to building an HP BladeSystem
Building your ideal BladeSystem infrastructure solution begins with eight simple steps, outlined in this whitepaper.
Securing Web Applications Made Simple and Scalable
Learn how automated security testing can provide a simple and scalable way to protect your web applications.
Build a Business Case: Developing Custom Apps
In this whitepaper learn how to maximize the value of custom applications by accelerating and simplifying their development.