Qwest for Buyer
by John Paczkowski
Posted on April 2, 2009 at 6:15 AM PT
Qwest just became interesting again. Shares of the smallest of the Baby Bells are on the upswing this morning following reports that it is considering selling its long-haul voice and data network. Sources familiar with the matter tell The Wall Street Journal that Qwest is in the early stages of seeking a buyer for the unit, which could be valued at about $2 billion to $3 billion.
For Qwest (Q), the sale would do much to pare down its
nearly $14 billion in debt; the company has $560 million maturing in 2009 and another roughly $2.2 billion due in 2010. But finding a buyer could be difficult. For one thing, the souring economy will make finding sources of funding difficult. For another, potential acquirers like AT&T (T) and Verizon (VZ) may decline to bid simply because of antitrust concerns. Said Michael Hodel, an analyst at Morningstar, “Both companies have spent the last five years rolling up a big chunk of the telecom industry, and I don’t think regulators would be in the mood to see those firms get even larger.”
