Cingular may buy AT&T Wireless: ; Cash deal could form nation's largest cellular carrier
Posted on: Thursday, 19 February 2004, 06:00 CST
ATLANTA - Cingular Wireless won the bidding war to acquire AT&T Wireless Services for nearly $41 billion in cash, a deal that would create the nation's largest cell phone company.
The merger between the second and third largest U.S. wireless companies was announced today as Britain's Vodafone Group PLC withdrew from the contest after four days of rising bids.
The impact that the merger will have in West Virginia was not immediately clear. AT&T Wireless has about 180,000 customers in West Virginia, making it one of the largest wireless providers in the state. Cingular offers service in some portions of the state's Eastern Panhandle and has cooperative agreements with some other providers in the state, including West Virginia Wireless.
Stan Sigman, president and chief executive of the Atlanta-based Cingular, said, "This combination is expected to create customer benefits and growth prospects neither company could have achieved on its own and will mean better coverage, improved reliability, enhanced call quality and a wide array of new and innovative services."
Cingular, a joint venture between SBC Communications Inc. and BellSouth Corp., said its winning bid was for $15 per share in cash, an amount that would value AT&T Wireless at $40.7 billion. Cingular will also assume $6 billion of debt owed by AT&T Wireless.
The agreement, subject to the approval of AT&T Wireless shareholders and regulatory authorities, may be the largest all- cash buyout in U.S. history, said David Caouette, spokesman for AT&T Wireless.
In addition to paying AT&T Wireless shareholders a 27 percent premium over the company's closing stock price of $11.82 on Friday, the merger may ease the cutthroat competition in the U.S. cellular market, trimming the number of national players from six to five.
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