Qwest ended its attempt to sell its long-distance network after failing to find offers that are attractive enough amid the recession.
Though the network drew “significant interest” in a bidding process, the asset holds more value as part of Qwest, the company said Monday in a statement.
Qwest had trouble finding bids for a system that was valued at as much as $3 billion, with some offers coming in at less than $1 billion, The Wall Street Journal said last week, citing people familiar with the matter.
The first global recession since World War II hurt Qwest’s customers and prospective buyers, cutting business to its network while making it more difficult for interested bidders to get financing. Qwest’s sales have dropped for the past two years and are projected to fall at least through next year, according to analysts surveyed by Bloomberg.
“With the exception of a few of the major metropolitan markets, nobody really wants them,” said Roger Entner, a Boston-based analyst at Nielsen who doesn’t own the shares.
“It’s very difficult to turn this situation around, so it’s a slow, long, drawn-out death unless there’s a major reversal of fortune,” Entner said.
The network carries data across long distances for corporate and wholesale clients and is complementary to Qwest’s traditional phone-line operation in 14 Western states.
