NEW YORK — Verizon Investment Management Corp. likely will assume oversight of the $1.6 billion of pension and retirement plan assets of MCI Inc. after its parent company acquires the smaller telecommunications firm.
Verizon Communications Inc., New York, announced its intention to acquire Ashburn, Va.-based MCI on Feb. 14 for $4.8 billion in equity and $488 million in cash. MCI also will pay its shareholders quarterly and special dividends totaling $1.5 billion, bringing the total value of the deal to $6.7 billion, according to statements from both companies. The deal is expected to close in about a year, pending regulatory approval.
William F. Heitmann, senior vice president-finance of Verizon Communications and president of Verizon Investment Management, Stamford, Conn., said it is logical to speculate that Verizon would take over management of the defined benefit assets of MCI, but no decision has been made.
"When the merger closes, we'll set up working committees and examine the best integration plan. MCI has relatively little in the way of pension assets compared to us, so it's fair to say that it probably will be integrated into ours. We'll take a look at all of the managers (of both plans) in terms of performance and how they fit into the asset allocation scheme. I don't know if there's going to be any shakeout; it's really too early to say right now," said Mr. Heitmann.