Silver™

I know there has been talk of this for a while, but it looks like it is getting closer to happening.

Wouldn't that combined company be bigger than Verizon? And won't that put some preasure on Verizon to merge with SprintPCS?







PHILADELPHIA - Cingular Wireless's interest in acquiring AT&T Wireless Services Inc. has intensified and it has the backing of its two parent companies to fund a purchase, sources familiar with the situation said on Wednesday.

There is no formal offer on the table, but the negotiations between Cingular and AT&T Wireless, respectively the No. 2 and No. 3 U.S. carriers, have progressed significantly beyond the on-again-off-again talks over the past year, the sources said.

T-Mobile and other carriers also have expressed interest in AT&T Wireless, but Cingular has been the most aggressive and vocal about its desire to forge a deal, the sources said. T-Mobile is owned by Deutsche Telekom AG.

A merger would mark the first deal in an industry that executives and analysts have said is long overdue for consolidation.

The six national carriers have launched aggressive pricing and marketing programs to woo each others' customers as overall subscriber growth in the United States has slowed.

Cingular had considered an initial public offering to help fund a deal, but that idea has been pushed aside for now, one source said.

Instead, Cingular would use the cash on its balance sheet, as well as money from its two parent companies -- SBC Communications Inc. and BellSouth Corp -- for a purchase of AT&T Wireless, which has a market capitalization of $23 billion, the source said.

SBC and BellSouth would not use their stock as currency. The parent companies would rely on their large cash war chests, but may tap the debt market for funds, the source said.

As of Sept. 30, SBC had about $4.9 billion and BellSouth had about $5 billion in cash and cash equivalents on their balance sheets.

Shares of AT&T Wireless rose five percent on Tuesday and closed at $8.55 percent on the New York Stock Exchange. Its stock has risen 20 percent over the past month, making any potential deal more expensive for Cingular.

Negotiations remain fluid and could crumble at any time, especially if another suitor enters the fray, the sources said. Issues such as management control or brand name for a combined Cingular-AT&T Wireless have yet to be addressed, sources said.

The timing of any agreement remains difficult to predict, but one source said an announcement could come before the carriers report fourth-quarter earnings later this month.

Cingular, T-Mobile and SBC could not be immediately reached for comment. AT&T Wireless and BellSouth declined to comment.

http://www.msnbc.msn.com/id/3955888/

dallison

would be 45 million customers

kensteele

All true except Verizon doesn't want to merge with Sprint. Not in my opinion. Maybe Verizon could merge with Alltel or one of the other CDMA carriers.

KCPreki11

This will kill T-Mobile. But then again, they care more about Europe than America.

mikeymobiles

This will only happen if the security exchange commision agrees and so does the fcc...i heard that might take a long time..

dallison

consolidation got the go-ahead last yearfrom fcc. so awe-cingular will happen this year

DISRUPTV

in the end...who will benefit from this the most and how willl consumers benefit from this if it were 2 go thru?

dallison

well if major consolidation occurs it prob. will raise some prices b/c of less competition

beerknurd

dallison, your avator is annoying.

dallison