MCI set to look at WorldCom bid

The board of MCI, British Telecom's US partner, is expected to authorise further evaluation of WorldCom's $30bn bid when it meets to review the position.

MCI, which had been due to complete its merger with BT this autumn until the surprise WorldCom offer, will be careful not to close off the option of pressing ahead with BT.

The meeting had been expected to take place today but it is now thought likely to be held later in the week. The three BT members on the MCI board, chief executive Sir Peter Bonfield, deputy chairman Sir Colin Marshall and Keith Oates, will be present but will not take part in discussions about the WorldCom bid.

MCI sources said the 14-strong board was likely to instruct the company's executive management to continue evaluating the WorldCom offer, which is worth $41.50 a share compared to BT's offer which values MCI at $34 a share.

However, it was stressed that the review would not have any direct impact on MCI's existing agreement with BT. WorldCom has offered to bring BT into a three-way alliance should its bid succeed - an option some analysts believe BT should take up. But BT has ruled out any direct contact with WorldCom until the MCI board has made its position known.

BT sources were continuing to stress last night that while there was a large gap between the value of its offer and WorldCom's, BT and MCI have built up a close working relationship.

It was also pointed out that MCI had agreed to a 22 per cent cut in the price of BT's offer after the shock profits warning it issued in July, saying that the cost of breaking into the US local telephone market could be $1bn more than expected.

Meanwhile, WorldCom confirmed its had appointed Liam Strong, the former chief executive of the Sears retail group, as chief executive of its international division.

Mr Strong left Sears in April with a pounds 450,000 pay-off and an entitlement to additional compensation if he failed to secure a commensurate job within nine months.

Mr Strong is to concentrate on marketing activities. WorldCom said his experience at British Airways, where he was marketing and operations director until his move to Sears, provided an ideal background.

-Michael Harrison