AT&T agrees to buy McCaw Cellular in stock swap valued at $12.6 billion; Baby Bells fear losing role as long-distance link; challenges are likely

Article Abstract:

AT and T agrees to acquire McCaw Cellular Communications Co, the nation's biggest cellular phone company, for $12.6 billion in stock. The regional Bell companies fear that the consolidation of AT and T's 90 million long-distance customers with McCaw's 2 million customers will allow their former parent company to challenge them as a provider of local phone service. The acquisition is second in US corporate history only to the $30.6 billion buyout of RJR Nabisco Inc in 1989. The news pushed up cellular stocks. McCaw stock rose $5 to $56.25 while Lin Broadcasting's Class B stock advanced $12.75 to $115 on the assumption that AT and T will buy up the 47 percent of LIN shares not owned by McCaw. AT and T agreed in Nov 1993 to acquire 33 percent of McCaw; since then, though, McCaw's stock has skyrocketed 93 percent. Apparently, AT and T decided it was better to pay relatively little for McCaw now than a lot later on.

Electronic computers, Television broadcasting stations, Telephone communications, exc. radio, Telecommunications industry, Cellular telephone services industry, Cellular telephone services, T, American Telephone and Telegraph Co.

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BellSouth, LIN sweeten plan to merge lines; accord involves huge debt and may fail to thwart rival suitor McCaw

Article Abstract:

Bellsouth Corp and LIN Broadcasting have reached an agreement to consolidate LIN's cellular telephone properties with Bellsouth's, spin off LIN's broadcasting operations, and pay shareholders a one-time dividend of $42 a share. These plans were formulated in an effort to stave off McCaw Cellular Communications Inc, which also wants LIN. The plan relies heavily on borrowed funds to pay the dividend, which would total about $2.23 billion, and $1.9 billion would be used to buy out the 55 percent equity interest of LIN's partner, Metromedia Co. Because of this debt, the new company created by the merger would not be profitable until at least 1994. The Bellsouth offer is worth about $115 to $125 a share; the company's previous bid was valued at about $98 to $110 per share. McCaw's offer is valued at about $112 to $118 per share.

Planning, Wireless communications, Acquisitions and mergers, Contracts, Mobile communication systems, Telecommunications, Mobile Phones, LIN Broadcasting Corp., LINB

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BellSouth, Sony join up to test wireless phones

Article Abstract:

BellSouth Corp joins with Sony Corporation of America to test a wireless telephone system in Georgia. The trial will involve about 35 customers. Sony will provide equipment and software, and BellSouth will supply management and operating infrastructure. Other companies, too, are accelerating efforts to develop wireless communications that are as convenient as cellular phones but are less costly. Nynex Corp, Bell Atlantic Corp, Pacific Telesis Group and US West Inc all are planning or installing wireless systems. PCN America Inc will construct experimental personal communications networks (PCNs) in Houston and Orlando. Millicom Inc and Graphic Scanning Corp also plan networks, and Motorola has proposed a satellite-based service.

Communications Equipment, Research, Wireless LANs, Regional Bell Operating Companies, Sony Corporation of America, Radiotelephones, Bell Regional Holding Companies, Wireless Network

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