By Lisa Kerner
Charlotte, N.C., Dec. 29 - AT&T Inc. closed its merger with BellSouth Corp. after the transaction was approved by the Federal Communications Commission on Friday.
Each outstanding share of BellSouth common stock was converted into 1.325 shares of AT&T common stock. Using the $35.75 per share closing value of AT&T stock on Friday, the deal is worth $86 billion, according to an 8-K filing with the Securities and Exchange Commission.
As a result of the merger, BellSouth becomes a wholly owned subsidiary of AT&T and its common stock, traded under the symbol BLS, is being delisted from the New York Stock Exchange.
The FCC determined the merger would likely result in consumer benefits including broadband deployment, increased competition for advanced pay television services, improved wireless products and enhanced national security, according to a news release.
In order to expedite the merger, AT&T agreed to a number of merger commitments. AT&T will repatriate 3,000 jobs currently outsourced by BellSouth outside the United States by Dec. 31, 2008. The San Antonio-based telecommunications company agreed to offer broadband internet access to certain in-region territories. Also, AT&T will make its disaster relief recovery capabilities available in BellSouth's in-region by June 1, 2007.
AT&T also will become the sole owner of Cingular Wireless LLC. Before the merger, the company had a 60% interest in Cingular, while BellSouth owned a 40% interest in the company.
BellSouth is a telecommunications company based in Atlanta.
| Acquirer: | AT&T, Inc.
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| Target: | BellSouth Corp.
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| Transaction value: | $85.8 billion
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| Payment per share: | Each BellSouth share into 1.325 shares of AT&T stock
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| Announcement date: | March 4, 2006
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| Closing: | Dec. 29
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| Stock price for target: | NYSE: BLS $46.80 on Dec. 28
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| Stock price for acquirer: | NYSE: T $35.75 at close on Dec. 29
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