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MCI, Sprint face EC probe
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February 21, 2000: 10:28 a.m. ET
Europe plans four-month antitrust review of $130B telecom merger
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LONDON (CNNfn) - - The European Commission said Monday it has launched a detailed four-month antitrust probe of the proposed $130 billion merger of U.S. telecom companies MCI WorldCom and Sprint Corp.
"The Commission has raised serious doubts as to the compatibility of the proposed merger between MCI WorldCom and Sprint, mainly because of its impact on competition in the market for top-level Internet connectivity," the Commission said.
A spokesman for the E.U. Commission said regulators were concerned about the impact the merger would have on Web users' access to the Internet backbone, as well as the transatlantic telephone market and services to multinational businesses. MCI Worldcom is the leading carrier of high-capacity Internet traffic among major carriers of Internet data, carrying as much as 40 percent of such traffic to the backbone, according to an estimate by the European Commission, the executive agency of the 12-nation European Union.
Hoping to satisfy concerns about the merger's effect on the market for business telecommunications and transatlantic calls, Sprint last month sold its stake in Global One, a joint venture with European carriers Deutsche Telekom and France Telecom. The companies have previously indicated they would be willing to divest Sprint's Internet backbone division if necessary to gain regulatory approval.
The Commission said it would assess the deal with the U.S. Federal Communications Commission and the Department of Justice, which had already raised concerns about the merger.
FCC Chairman William Kennard said the merger could represent a "surrender" from the robust competition that has driven down long-distance telephone call rates for U.S. consumers. 
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Sprint
MCI Worldcom
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