BRUSSELS - The planned merger between MCI Worldcom and Sprint is running into trouble in the European Union, Competition Commissioner Mario Monti revealed Wednesday.
"Our investigation has confirmed our serious concerns about the impact on competition, and in the next few days we will send a statement of objections to the parties," the commissioner told a news conference. A statement of objections sets out the commission's concerns about how an operation will reduce or restrict competition in the EU market. The commission believes that the merger between MCI WorldCom and Sprint will create a dominant position in the provision of high-speed global services for multinational companies and the termination of international voice telephony calls in the U.S., the commissioner said. The commission has until July 7 to rule on the merger, but the statement of objections indicates that if the companies want approval, they will have to make certain concessions.All large mergers with a global turnover of at least $5 billion and with activities in at least two member states of the EU require prior commission authorization. Although the commission rarely prohibits a merger or acquisition, it regularly imposes conditions including divestments before authorizing them.
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