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Vodafone Says Call Revealed Details About AT&T Wireless

Posted on: Tuesday, 24 February 2004, 06:00 CST

British cell phone giant Vodafone Group PLC's chief executive received a 2 a.m. call from AT&T Wireless Services Inc.'s chief executive in the midst of a late-night bidding war for AT&T Wireless, disclosing new and unfavorable details in its operations, Vodafone officials said yesterday.

Vodafone head Arun Sarin took a call from AT&T Wireless chief executive John D. Zeglis at 2 a.m. London time on Feb. 17, during which Zeglis unveiled new information indicating the company was in worse shape than Vodafone officials had previously known, according to Vodafone spokesman Bobby Leach.

"From our point of view, it was new information," not already in the books Vodafone reviewed in the weeks prior to submitting its bid, Leach said, but declined to detail the new information. "Clearly, we asked for more time to consider it," Leach said, but after Cingular Wireless LLC upped its cash bid to $41 billion, Vodafone withdrew its offer.

AT&T Wireless officials denied they provided any new last-minute information about the company's condition. "There were no eleventh-hour surprises," said AT&T Wireless spokesman David Caouette. "All bidders were provided the same information. At no time was additional information provided to select bidders."

Caouette declined to say whether Zeglis made an early-morning call to Sarin, but said that even if he did, it was not with the intent of providing new information about the company's operations.

The original deadline for submitting bids had expired Feb. 13 and AT&T Wireless's board of directors was in the process of reviewing competing offers from Vodafone and Cingular when Zeglis's alleged call was made.

Even if it hadn't received the new information from AT&T Wireless, Vodafone had already determined its price -- $38 billion in cash, according to other sources close to the deal -- and "we had no intention of going higher," Leach said.

"It was very unusual," Sarin said of the call from Zeglis, in an interview published in the Sunday Times of London. "We were quite surprised. We knew the business was weak, but we didn't know how weak."

Executives at one of Cingular's parent companies, SBC Communications Inc., did not receive any calls with new information from AT&T Wireless the night Sarin said he received a call, according to an SBC official. BellSouth Corp., Cingular's other parent, did not return phone calls yesterday.

"We believe the bidding process was fair, and both companies should have been shared the same information," said Jennifer Bowcock, a spokeswoman for Cingular. She declined to comment on whether Cingular also received a last-minute call providing updates on AT&T Wireless's operations.

Reported By TechNews.com, http://www.TechNews.com

(20040224/WIRES /)

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