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News > Deals
AT&T board to meet
July 16, 2001: 4:23 p.m. ET

Board to discuss Comcast's $45 billion offer; other potential bidders seen
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NEW YORK (CNNfn) - The board of AT&T Corp. is set to meet and a decision on Comcast Corp.'s unsolicited $45 billion bid for the broadband unit could come this week, a source told CNNfn.com Monday.

AT&T's board will be meeting in Denver on Tuesday and Wednesday and Comcast's bid will likely be the primary topic of discussion, the source said.

New York-based AT&T, the nation's biggest long-distance telephone and cable television company, has yet to respond to Comcast's proposal. Last week, Comcast unveiled its all $45 billion offer for AT&T Broadband that would create the biggest broadband communications provider with about 22 million subscribers and leading positions in eight of the top 10 U.S. markets.

The board could conceivably reach a conclusion this week. However, it would take AT&T time to evaluate the Comcast offer and a decision could take weeks, a source close to the situation told CNNfn.com.

"Clearly the market has spoken overwhelmingly in favor of bid," a person close to Comcast said. "We would like to see a response this week. But there is no guarantee."

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Press reports Monday floated many different versions of the Comcast-AT&T discussions.

AT&T is actively seeking other bidders for its cable operations, the New York Times reported Monday. AT&T routinely talks to several different companies but has yet to receive a formal offer, a source close to the company told CNNfn.com last week.

Cox Communication denied a report saying that AT&T CEO Michael Armstrong met with Cox Communications Inc. (COX: Research, Estimates) about a possible bid on July 7 – the day before Comcast's $44.5 billion bid for the cable operations, which AT&T was already planning to spin off to shareholders by 2002.

"There was no meeting between Roberts and Armstrong on July 7," a Cox spokeswoman said. The CEOs of both companies have met and talked in the past but the two execs did not meet on July 7, she said.

Philadelphia-based Comcast, the No. 3 U.S. cable operator, denied another story in Newsweek that said it offered to give Armstrong control of the combined AT&T Broadband-Comcast unit for 18 months before yielding to Comcast President Brian Roberts.

News of the Comcast bid caused AT&T stock to surge last week but shares lost marginally Monday. Comcast gained nearly 3 percent.

Potential bidders

Analysts have speculated that the Comcast offer would cause other companies to pitch deals.

In addition to Cox, AOL Time Warner Inc. (AOL: Research, Estimates), the No. 2 cable operator and parent of CNNfn, has been touted as a possible bidder. A spokesman for Time Warner Cable declined to comment.

Charter Communications Inc. (CHTR: Research, Estimates), which is controlled by Paul Allen, co-founder of Microsoft Corp. (MSFT: Research, Estimates), has also been mentioned. Charter could not be reached for comment.

In a speech last week, Armstrong said AT&T is seriously considering the Comcast bid, but suggested it is looking for a higher bid before it agrees to a deal.

"[The offer] recognizes at least some of the value that we've created in AT&T Broadband. The question is whether it recognizes the right value," he said in a speech to the Boston Chamber of Commerce on Wednesday.

AT&T is continuing with its plans to split into four separate companies and is planning an IPO of the broadband unit before the end of the year, pending shareholder approval. The broadband unit, which will trade as a tracking stock, will then be spun off as an asset based security within 12 months, she said.

The Comcast offer could be a stumbling block for the broadband tracker, analyst Pat Commack of Guzman & Co. said. "Shareholders might say we're not going to vote for this tracker because we want you to sell it to the highest bidder," he said. "It might be difficult for AT&T to drum up the votes."

AT&T will likely vote against the Comcast offer which may cause the Philadelphia cable provider to sweeten it bid.

However, AT&T must respond before Comcast decides whether to boost its $58 billion offer, a source close to the negotiations said.

"The ball is in their court," a source said. "There is no reason to raise the bid since no one else has a bid in. The offer is on the table."

Both AT&T and Comcast declined to comment. graphic

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.