Through research we have found that MCI Communications was an American telecommunications company, headquartered in Washington D.C., that was active in changes that resulted in the breakup of the AT&T monopoly of American telephony and lead in the competitive lone-distance telephone industry. MCI was founded in 1963 and grew to be the second-largest long-distance provider in the U.S. They offer 800 service, operator assistance, worldwide direct dialing, fax and 900 Service. WorldCom purchased the company in 1998 and became known under the name MCI WorldCom. WorldCom went through financial scandals and bankruptcy that led the company to change its shortened name, WorldCom, to MCI in 2003. Verizon purchased this company in January 2006, and as of May 2011 the MCI trademark is still maintained on the internet.
Compared to other stocks in the market, throughout most of 1995 MCI's stock was not producing impressive results. MCI's management had noticed the shareholders becoming more impatient. One of MCI's directors, Gavin Phillips, thought that financing the repurchase by increasing the debt financing would prove to the market there is a positive prospective future for the firm. Phillips approach stated that the company would need to increase its debt-equity ratio to almost twice its current forty percent. To achieve this goal, Phillips decided that it would require MCI to issue around two billion dollars in additional debt.