The move recasts the two-month battle for control of MCI, which had accepted Verizon'soffer over a $9.1 billion bid by Qwest Communications.
The Verizon deal with Slim offers a higher price for his MCI shares than other shareholders would get under Verizon's offer. Investors have kept MCI shares trading higher than Verizon's asking price in recent days on expectations that Verizon would have to raise its price or Qwest might launch a hostile bid.
Verizon Chairman Ivan Seidenberg said in a statement the company would "continue to assess the situation as we move toward a vote by the MCI shareholders."
In rejecting Qwest's latest offer, MCI said Verizon's bid offered more certainty of closing, while Qwest's bid was unpopular with its customers. MCI also said it was concerned with Qwest's estimates of $14.8 billion in cost savings, including up to 15,000 job cuts, and potential liabilities, such as damages from long-running shareholder lawsuits.
Qwest said in a statement that with the Slim deal, "Verizon has both created two classes of shareholders and called into question the MCI board's previous determination that Verizon's lower offer to the other MCI shareholders was superior and fair." It said it still believed its bid was superior.
Verizon is paying Slim more for his shares than other MCI shareholders would receive under the Verizon offer.
MCI declined to comment.
Qwest said Friday a poll it commissioned found that investors owning more than half of MCI shares supported its bid over the Verizon deal, as Qwest mulled a possible hostile bid for MCI. Several large MCI shareholders had said publicly the Qwest bid was superior, and Slim had said through a spokesman that the bids were approaching a fair value for MCI.
A Qwest spokesman said Slim was not part of its poll.
Verizon said it agreed to buy 43.4 million MCI shares from Slim's companies for $25.72 a share in cash. In addition, it will pay Slim's companies a bonus in one year should Verizon's share price exceed $35.25. Verizon shares closed Friday at $35.07.
Verizon expects to close the deal with Slim in several weeks.
Under its deal with MCI, Verizon has offered to pay MCI shareholders $23.50 per MCI share, with $8.75 per share in cash and $14.75 per MCI share in Verizon stock.
MCI shares closed on Friday at $25.84.
Verizon and Qwest see buying MCI as the best way to grab a foothold in the market for telephone and data services to large corporations. While such a deal would have a small impact on Verizon, it would transform the smaller Qwest, which is also eyeing MCI's cash flow as a way to reduce its own $17 billion debt load.
Slim, Latin America's richest man and the fourth-wealthiest in the world according to Forbes magazine, is the scion of a global business empire with holdings ranging from construction to telecommunications to cigarettes.