AT&T to Buy BellSouth

[Ouchyfish]

AT&T to Buy BellSouth for $67B in Stock By HARRY R. WEBER, AP Business Writer

ATLANTA - AT&T Inc. is buying BellSouth Corp. for $67 billion in stock in a bid that further consolidates the telecommunications industry and would give AT&T total control of their growing joint venture, Cingular Wireless LLC.

The proposed purchase, announced Sunday, also goes a long way toward resurrecting the old Ma Bell telephone system, which was broken apart in 1984.

The merged company would have 70 million local-line phone customers, 54.1 million wireless subscribers and nearly 10 million broadband subscribers in the 22 states where they now operate. The deal appears to be the largest yet among U.S. telecom players.

In 1999, MCI WorldCom Inc. agreed to buy Sprint Corp. for an even larger sum, $115 billion, but that deal was blocked by federal regulators. Internationally, Britain's Vodafone Airtouch PLC paid $180 billion in stock for Mannesmann AG of Germany in 2000.

The sale, which is subject to regulatory and shareholder approvals, would give San Antonio-based AT&T total control over Atlanta-based BellSouth's nine-state network and its share of Cingular. AT&T currently owns a 60 percent share of the nation's No. 1 cell phone provider, while BellSouth has 40 percent.

The deal would substantially expand the reach of AT&T, already the country's largest telecommunications company by the number of customers served.

Together, the three companies employ more than 316,000 people, though that head count may fall as AT&T eliminates redundant operations.

After spending millions of dollars to rebrand AT&T Wireless Services Inc. stores as Cingular stores and hundreds of millions of dollars more on marketing the new Cingular after its $41 billion acquisition of AT&T Wireless in October 2004, Cingular will now become AT&T if the merger with BellSouth is completed.

The BellSouth name also would be absorbed in the deal.

"It's going to be confusing," said industry analyst Jeff Kagan. "This is the reinvention of the telecommunications industry."

AT&T will pay 1.325 of its own shares for each BellSouth share. Based of Friday's closing price of $27.99 for AT&T shares, that works out to be $37.09 for each BellSouth share, an 18 percent premium from the Friday closing price of $31.46 for the company.

AT&T Inc. was formed by SBC's acquisition of AT&T Corp. in November. The deal added a substantial national reach to the former Southwestern Bell's local business, which is concentrated in 13 states, including Texas, California, and the Midwest.

BellSouth is the dominant local telephone provider in the Southeast.

The shift in the U.S. telecom landscape — moving from four to three regional Bell operators — is sure to garner close review from Washington.

"Twenty years after the government broke up Ma Bell, this deal represents a mother and child reunion," said Rep. Ed Markey, the ranking Democrat on the House Subcommittee on Telecommunications and the Internet.

"Our nation's telecommunications markets must be vigorously competitive and open to innovation in order to promote job creation and economic growth," Markey said. "This merger proposal is one that unquestionably merits the utmost scrutiny by government antitrust officials."

The deal furthers the reunification of the Baby Bells, the eight regional telephone operators that were spun off from the old AT&T in 1984 under a federal court order. At that time, and in a different regulatory climate, AT&T was largely a long-distance company.

Cingular spokesman Mark Siegel dismissed the notion there would be public perception issues with the switch back to the AT&T name for the wireless company.

"We built a business," Siegel said. "Is the brand an important part of that business? Yes. But it is a business that is made primarily up of people. None of that changes."

Siegel said sole ownership by AT&T "gives us clarity of decision-making, and that is a good thing."

With cable companies increasingly vying for traditional phone companies' share of local telephone service, such mergers in the industry have been commonplace of late. Kagan, the industry analyst, said more could be on the horizon.

"We're not over it yet," Kagan said.

The combined company will be based in San Antonio, and Ed Whitacre, AT&T's chairman and chief executive, will keep those positions. His counterpart at BellSouth, Duane Ackerman, 63, will run BellSouth's operations in a "transition period" after the merger.

Cingular's headquarters will stay in Atlanta, as will the Southeast regional headquarters for the merged company.

Cingular has grown strongly since it was formed in 2001 by the merger of a number of regional wireless carriers, and there has been speculation that AT&T wanted to assume full control of this growth business, in part to be able to market it under the AT&T name.

The wireless operations will be the growth engine of the new company, and will account for one third of the combined revenue.

AT&T expects the acquisition to save it $2 billion annually, starting the year after the deal closes. About half of the savings would come from reduced advertising expenses and from combining their work forces.

The rest of the savings would come from combining the backbone network and information-technology operations of the two companies.

___



I'm confused. Wasn't AT+T forcibly broke up into baby bells?

[Phlegm]

It was broken up because it was a monopoly but now there are a lot more competitions for every aspect of their business.

[Ouchyfish]

So now they can go around and buy up the compeition and repeat the process?

[Phlegm]

So now they can go around and buy up the compeition and repeat the process?

Up to a certain point it can. Eventually the antitrust people will stop it if it has the possibility of becoming a monopoly again.

[dammuzis]

alot has changed
they didnt break up microsoft even though they should have

[Sorina S]

It's not the old AT&T it's some fuckin scam corp called SBC or somethin. These bastards turned on long distance on my DSL line and started chargin me 13 bux a month, for nothing. I never authorised it, never used it, never asked for it...they just did it cus they could. Fuckers. AT&T as we knew it, Ma Bell no longer exists.

The deal with Bell South is an SBC deal I belive. I wouldn't buy their stock.

[Phlegm]

It's not the old AT&T it's some fuckin scam corp called SBC or somethin. These bastards turned on long distance on my DSL line and started chargin me 13 bux a month, for nothing. I never authorised it, never used it, never asked for it...they just did it cus they could. Fuckers. AT&T as we knew it, Ma Bell no longer exists.

The deal with Bell South is an SBC deal I belive. I wouldn't buy their stock.

SBC(Southwestern Bell Corp.) bought AT&T last year and now they are buying Bell South. When they bought AT&T, they decided to keep the AT&T name.

SBC also bought 60% of Cingular last year after Cingular bought AT&T wireless. Bell South bought the other 40% of Cingular. So after this sale, the new AT&T corp will own 100% Cingular.

The only sure thing about mergers and buyouts like this one is that there will be layoffs to eliminate redundancy. I think they said they will get rid of around 10,000 jobs.

[Sorina S]

Wait, so SBC, bought itself? I thought AT&T was buying BellSouth but it's actually BellSouth buying itself back from AT&T and then selling out to SBC who is actually BellSouth. Okay this is beyond my depth. (thats a great sig line for one of you haters ^,~)

I still won't buy their stock. Nor will I use their services.

[Darcler]

I get SBC services for free <3

[Sorina S]

I get SBC services for free <3

That's because you're a commie.

[Darcler]

Either a commie or because my mother in law works for them. Whichever.

[Sorina S]

Yeah, one of the perks of communism, you get free infrastructure. God bless Texas.

[Martrae]

I can bet that deal will go bye-bye with the new merger. Kahar's dad has worked for AT&T for 30+ years and only the employee gets free home service, no family members.

[Darcler]

Ah-ha! But she is living with us until her mother in law's house is sold. So, for the rest of the year, we have free SBC service.

What does Texas have to do with anything? lol

[Tossica]

Texas! LOL

[ClakarEQ]

SBC bought ATT and kept the name becuase SBC is shit for a "Brand".

ATT is "global" SBC never was, ATT is known global, SBC is not, hence the ATT name was kept.

ATT(formerly SBC) is buying BellSouth and Phlem is right, they plan to lay off a good chunk of folks, this would be normal practice though for these type mergers.

What worries me, being a bit paranoid, is a company of this size has big lobby power, i'm less worreid about monopoly and more about a lobby.

There has already been "rumors" in the industry to turn internet services into a utility. In some cases this is fitting however utilities charge by usage, not by "size"

Example
Broadband is say 3Mb, if I use 3Mb or 1Mb or 1Kb of that 3Mb pipe my costs are the same, if I use 3Mb for 30days 24x7x365 or 1Kb a year, say 49.99 a month from comcast. Now if same pipe (3Mb) was billed by usage, my billing becomes tier'd, if I use 1Mb I get a bill for 1Mb not a bill for the Pipe but the traffic that traverses the pipe. I will nearly by my left nut this will be more costly then a flat "size" fee. Sure at first it won't be, some folks will look at this as a boon to their telco bill, until all movies (ala on-demand, all VoIP, etc) start using that same "pipe", 2 hour movies are what, 2-9GB, wait for HD Movies those are expected to be 50GB+/- a few GB in size, and you start sucking down a movie to watch.

The internet (credit to Al Gore of course, the inventor) is the only "utility" to my knowledge that is not usage based billing (and it will be a bad bad day for all of us if they ever do it). BTW I think the US, maybe Canada and some others are the very few countries (to my knowledge) that do the "internet" billing this way (NOT usage based).

crap, every post liek this of mine I always ramble /smack

[Ouchyfish]

Yes but when you ramble, you make sense at least. Unlike our resident poster child of premature senility, Sorina.

[ClakarEQ]

What the new CEO of ATT has to say. (this isn't new but to put some tracktion into my paranoia)

AT&T chief executive officer Ed Whitacre has made himself a major target in the debate with his outspoken comment that he would like to charge Google and other content providers for using the company's high-speed Internet connections into homes and businesses.

"Why should they be allowed to use my pipes? The Internet can't be free in that sense, because we and the cable companies have made an investment, and for a Google or Yahoo or Vonage or anybody to expect to use these pipes (for) free is nuts," he said in a BusinessWeek interview last year.

Link to full:
http://www.msnbc.msn.com/id/11715558/

[Sorina S]

Yes but when you ramble, you make sense at least. Unlike our resident poster child of premature senility, Sorina.

I wasn't rambling, my distain for them was to the point. Please Fish there's so much good stuff you could troll me on, why grasp at straws?

[Ouchyfish]

I wasn't trolling. I would be happy if you'd keep your crazy ass confused bullshit banter out of my threads.

[Harrison]

my distain for sutpitity is runing l0w I w1sh I cood r3ad

[Sorina S]

I wasn't trolling. I would be happy if you'd keep your crazy ass confused bullshit banter out of my threads.

Yeah but you'd prolly be just as happy playing your 'woobley' blue blanket and seein how they haven't seen fit to ban me yet, welll I guess you'll just be puttin up with my banter for now Fish.

Harrison, don't taunt me.

[Jay]

One thing will remain for certain. Cingular will remain a company that sucks phat cock. Those motherfuckers are the biggest scam artists known to man.

[Darcler]

I wasn't trolling. I would be happy if you'd keep your crazy ass confused bullshit banter out of my threads.

Yeah but you'd prolly be just as happy playing your 'woobley' blue blanket and seein how they haven't seen fit to ban me yet, welll I guess you'll just be puttin up with my banter for now Fish.

Harrison, don't taunt me.

Do you WANT to be banned? I see this is a pretty common point in your posts. "I'm not banned yet, which means ____"
"Just ban me if you dont like _____"

[Jay]

Sorina may be a disillusioned, cock gobbling ass spelunker, but nothing worth a ban. Everyone has a right to speak their mind even if their opinion is absolutely utterly retarded.