Sell-Offs MCI and WorldCom Are Closer to a Deal

MCI Communications Corp.’s $37 billion mega-merger with WorldCom Inc. advanced one step further with the sale of its InternetMCI business to Cable & Wireless PLC for $1.75 billion in cash. The divestiture prompted the Justice Department to clear the way for MCI’s megadeal, although the transaction still required approval from the Federal Communications Commission and four states. InternetMCI has revenue of about $375 million. MCI said that proceeds from the sale would be used for general business purposes and debt reduction. The companies expect that the explosive growth of the Internet would help the new MCI WorldCom to easily replace the earnings potential of the divested business. Seeking to bolster its biotechnology operations, Monsanto Co. agreed to acquire a wheat-breeding business from Unilever Group for $525 million. The former chemicals and agricultural products company, which spun off its chemicals business last year, said that this deal would bring an end to its recent buying spree of seed companies. It has been acquiring plant-breeding businesses over the past three years as part of a strategy to make itself a global leader in crops and biotechnology. Unilever, the Anglo-Dutch conglomerate, put its Plant Breeding International Cambridge unit on the block earlier this year. The business was acquired from the British government more than a decade ago. Unilever has been divesting lines from specialty chemicals to foods businesses in order to sharpen its focus. Scrubbing a planned IPO, Seagram Co. Ltd. took the quick route to divesting its huge Tropicana juice business by selling it to PepsiCo Inc. for $3.3 billion. The direct sale telescoped the process for obtaining a big slug of cash to help finance Seagram’s mega-acquisition of tape and CD firm Polygram NV and continue the firm’s penetration of show business. PepsiCo adds a major consumer brand to a stable of products that already includes Pepsi-Cola soft drinks and Frito-Lay snack foods. It also sets up a second line of direct competition with Coca-Cola Co., which owns the Minute Maid juice brand.