The prize was a seat at the high-stakes table for the worldwide telecommunications market, and WorldCom Inc. looks to have grabbed it.
WorldCom raised its bid for MCI Communications Corp. from $41.50 to to $51 a share, and MCI announced it had accepted the bid Monday morning. WorldCom's sweetened $37 billion stock-and-cash bid ended weeks of corporate intrigue, begun when British Telecommunications plc. renegotiated an earlier deal to buy MCI. That sparked WorldCom's initial bid, which was followed by a $28 billion all-cash offer from GTE Corp.
Over the weekend, WorldCom sweetened its price, and the boards of both WorldCom and MCI agreed to the deal on Sunday.
It will be the largest merger in corporate history, assuming regulators in the U.S. and Europe approve the deal. GTE may still counter offer, but it appears unlikely to top WorldCom's bid, according to Wall Street sources.
The new offer will be paid in WorldCom stock to all shareholders other than British Telecom, which holds a 20 percent stake in MCI and will receive $7.4 billion in cash. In London, BT officials were declining to comment on the deal.
With British Telecom cashed out, MCI shareholders would own about 45 percent of the new company, while WorldCom would have a 55 percent stake.
MCI Chairman Bert Roberts will become chairman of the new company, which will be called MCI WorldCom, and Bernard Ebbers, chief executive of WorldCom, will become CEO of the new company.
MCI WorldCom is expected to have more than $30 billion in sales next year, a joint statement said. The business combination should boost WorldCom's earnings by more than 20 percent in the first year after the deal closes, it added.
Reuters and ZDNN UK contributed to this report.