Worldcom tests merger decision

US telecom giant Worldcom has not given up hope of pulling off its $129bn proposed merger with its rival, Sprint Corporation.

The two companies called off the merger in July after the European Commission blocked it, saying it would create a dominant position in the market for universal internet connection.

The commission fundamentally misperceived how internet services are provided

Worldcom

Now, Worldcom has decided to appeal against the decision.

It says the regulators "fundamentally misperceived both how internet services are provided and the highly competitive nature of the internet marketplace.

"The implications of the commission's decision for Worldcom, for our customers and for the internet industry as a whole compel us to file this appeal so that the decision does not become the basis for future commission actions."

We are confident the decision is sound

Amelia Torres, EU spokeswoman

The EU's competition spokeswoman Amelia Torres said the commission believed its decision would survive any legal challenges.

She said: "It is their right to disagree with the commission. We are confident the decision is sound."

American concerns

The US Justice Department had also signalled its intention to challenge the merger before Worldcom and Sprint called it off in July.

The American regulators feared the two companies would stifle competition in the long-distance market and raise prices for consumers.

WorldCom is the second-largest telephone company in the US, while Sprint is the third-biggest.

The companies said at the time that changes to the deal requested by the Justice Department "would have eliminated the customer benefits and financial synergies that supported the proposed merger".