On Saturday morning Verizon agreed to pay the Mexican billionaire, the world’s fourth richest man, $25.72 in cash for each of his 43.4 million shares, making Verizon the largest MCI shareholder. This price is more than the $23.10 a share, or $7.51bn, Verizon has offered for all of Ashburn, Virginia-based MCI’s stock.

Commenting on the deal, Verizon’s Chairman and CEO Ivan Seidenberg said: While this was an opportunity for us to purchase a block of shares under unique circumstances and is an important step forward in our acquisition of MCI, we will continue to assess the situation as we move toward a vote by the MCI shareholders.

Yet according to the Wall Street Journal, the deal came about after Seidenberg had flown to Mexico during the past two weeks to negotiate with Slim personally and let him know that Verizon was willing to cut a special deal with him.

The deal to pay a higher price to just one shareholder, and another price to the remaining shareholders, has drawn strong criticism, especially given the fact that Slim had been one of the most vocal of MCI shareholders to back Qwest’s rival bid, and just last week had been expected to inject money into Qwest to help fund a renewed takeover bid. Slim was one of a handful of other significant MCI investors who were thought to be ready to inject funds into Qwest to help it finance a new bid.

Qwest was quick to express its anger at the deal, after a board meeting on Sunday. By entering into its deal with Mr Slim, 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. We believe Qwest has a superior proposal for all shareholders, said Qwest in the statement.

The fact that Verizon has offered two prices for stock it is looking to acquire has not drawn any response from the Securities and Exchange Commission. Indeed, when ComputerWire approached the Commission over the legality of the Slim deal, SEC spokesman John Heine said: The SEC does not provide comments on specific transactions… certainly not to the press anyway.

So what are Qwest’s chances now that Slim has thrown his hat in Verizon? Roughly 70% of MCI is controlled by hedge funds and Wall Street investors, and they are unlikely to accept the $23.10 a share deal that Verizon currently has on the table considering Verizon paid more to Slim. Last week, Denver, Colorado-based Qwest said that, even without Slim, more than 50% of MCI shareholders would vote in favor of its offer, citing a survey it commissioned.

Realistically, Qwest is unlikely to make any move until it has assessed the level of shareholder outrage over New York-based Verizon’s agreement with Slim.

Legg Mason Capital Management holds 1.7% of MCI shares and 13% of Qwest shares. Its spokesperson Bill Miller told MCI chief Michael Capellas in a letter on Saturday that shareholders would be outraged if the board doesn’t insist that all shareholders receive the $25.72 per share cash price Slim has agreed to take from Verizon.

There can be no reason for the board to support an offer to MCI owners that is substantially inferior to what Verizon has just agreed to pay for a non- control block of stock, Miller said in the letter which was made public late Saturday.

Leon Cooperman of Omega Advisors has also wrote to the MCI board demanding that its directors seek an equal price for all investors. Meanwhile Bruce Berkowitz of Fairholme Capital Management, which owns 3.4% of MCI stock, said in a letter to MCI’s board that the process clearly has become an auction and urged directors to take the highest price.

Shares in Qwest fell 1.2% on the New York Stock Exchange to $3.88 as of 5pm BST on Monday. Verizon was also down 0.1% to $35.02, while shares in MCI rose 0.2% to $25.91 on Nasdaq. Verizon’s agreement with Slim is subject to approval from the US Justice Department.