AT&T mulls long-distance spinoff - Oct. 4, 2000

News > Companies

AT&T to exit long-distance?

October 4, 2000: 1:07 p.m. ET

Management reportedly proposes spinning off unit to shareholders

NEW YORK (CNNfn) - AT&T Corp. has been shedding business units since a government-ordered breakup in 1984 and now management is proposing to spin off of its venerable consumer long-distance business.

Citing people familiar with the matter, the Wall Street Journal reported Wednesday that AT&T is leaning toward a spinoff rather than outright sale of its long-distance business. The proposal was presented to the company board at its annual retreat last month, the newspaper said.

AT&T officials declined to comment Wednesday. The company's stock was up 63 cents at $29.75 shortly after 1 p.m. ET.

AT&T, still the nation's No. 1 long-distance carrier, recently has been seeking ways to boost its sagging share prices, including a possible linkup with British Telecommunications PLC. ATT Wireless, which was spun off from the parent company earlier this year, is actively courting a merger with wireless firm Nextel Communications.

AT&T hopes to consummate one or both deals before its late October board meeting and before announcing the consumer long-distance spinoff, the newspaper said.

Shares of AT&T (T: Research, Estimates) added 12 cents to $29.12 Tuesday but still are trading just above a yearly low of $27.25.

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