Deephaven Capital Management has launched what is likely to be a difficult proxy fight to halt Verizon Communication's $8.5 billion bid for embattled MCI Inc.
Deephaven, which holds just under 5% of MCI's market cap, filed documents with the Securities and Exchange Commission that indicated that the hedge fund firm would vote against the merger and encourage other shareholders to do so. Deephaven's argument is that Verizon's $26-per-share deal is too low.
And the Minnetonka, Minn.-based investment firm instead favors Qwest Communications International. But sure to complicate matters is that Qwest, a former suitor of MCI, doesn't have an